UK PMI Manufacturing was finalized at 47.0 in January, up from December’s 46.2. This modest improvement, however, did not signal an end to the sector’s downturn, with continued contractions observed across key areas.
Rob Dobson, Director at S&P Global Market Intelligence, highlighted the pervasive nature of the contraction, noting declines in output, new orders, and employment across various manufacturing sub-industries. He pointed out that manufacturers are adopting a cost-cautious approach, focusing on cutting back on purchasing and stock holdings to improve efficiency, maintain cash flow, and protect margins in these challenging times.
The industry faces compounded difficulties due to the ongoing “Red Sea crisis”, which is exacerbating supply chain disruptions. The rerouting of inputs from the Asia-Pacific region is leading to increased costs and longer supplier lead times, intensifying the strain on production schedules and amplifying inflationary pressures. This situation is particularly problematic as manufacturers grapple with weak domestic and international demand.
Full UK PMI manufacturing release here.
