Last month British manufacturing contracted at the speediest rate during previous seven years, crushed by the extending crisis of Brexit and the international downturn, boding poorly for the economic rebound chances in the 3rd quarter, according to the survey on Monday.
IHS Markit/CIPS UK Manufacturing Purchasing Managers’ Index
The CIPS/IHS Markit U.K. Manufacturing Purchasing Managers’ Index (PMI) fell to 47.4 from 48.0 during the last month, a full point less than the median forecast in a poll of the economics of Reuters. Rob Dobson, the director of IHS Markit, said that high levels of political and economic uncertainty along with ongoing worldwide trade disputes stifled the United Kingdom manufacturers’ performance in August.
Sterling slipped on the statistics released and was less by 0.6 percent against the U.S. dollar for the session, trading at around$1.2080 by 11:00 a.m. London time. The economy of Britain shrank in the 2nd quarter, a hangover from the stockpiling boom in advance of the real Brexit deadline of March. An additional reduction in the present quarter would herald a recession officially.
The PMI disclosed manufacturing succumbing of Britain towards a decline that swept over Europe, in spite the last month uptick in France. Previous week surveys from the European Commission and Lloyds Bank also recommended that the economy of Britain is stalling, raising the stakes for Boris Johnson who swore to take Britain outside the E.U. with or without an agreement.
Respondents to the survey of PMI refer to the worldwide slowdown and Brexit as causes for lower demand form foreign as well as domestic customers, few of whom are transferring supply chains away from Britain before the deadline of 31 October for leaving the E.U. HIS Markit survey compiler said that its surveys were steady with a decay in the official factory output measure of about two percent quarter-on-quarter. The index of the future output of survey fell to its bottom level since records taking place in 2012.