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The downturn in the UK’s manufacturing sector continued in July, according to survey data on Tuesday.
The S&P Global/CIPS manufacturing purchasing managers’ index worsened to 45.3 in July, from 46.5 in June. The sub-50 reading indicates a continuing contraction in the sector. This was slightly below a previous flash estimate of 46.5.
This marks the lowest reading in the year so far and the joint-weakest since May 2020.
July saw levels of manufacturing output and incoming new business contract further, S&P noted.
‘Output fell at the quickest pace since January, as overstocked clients, rising export losses, higher interest rates and the cost-of-living crisis coalesced to create a worrying intensification of the slump in demand. Although manufacturers maintain a generally positive outlook for the sector, with over half still expecting output to rise over the coming year, other forward-looking indicators show the mire that industry is currently facing,’ said Rob Dobson, S&P Director.
Looking ahead, manufacturers continued to forecast ‘brighter conditions’, despite the current tough operating environment. S&P said around 53% reported that they expect output to rise over the coming year, with the degree of positive sentiment edging up from June’s six-month low.
The UK manufacturing PMI is compiled by S&P Global from responses to surveys sent to purchasing managers’ at around 650 manufacturers, with data collected between July 12 and 26.
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