UK manufacturing stays lower - ING

James Smith, Developed Markets Economist at ING, explains that at 54.4, the latest UK manufacturing PMI is a little better than hoped but is still a far cry from the levels seen towards the end of last year

Key Quotes

“Whilst Markit/CIPS noted the weakness partly reflected a slower pace of domestic orders, we also wonder whether the steadier global growth over the past few months is starting to weigh. We suspect it is too early to see any tariff impact in these figures, but the slowdown in the Eurozone that we saw through the first quarter may be playing a role. The gradual strengthening in the trade-weighted pound since last summer could also be beginning to hit demand at the margin.”

“Of course, the UK’s manufacturing sector only makes up around 10% of the economy, so we suspect the Bank of England will be paying closer attention to next week’s services index as it tries to gauge whether growth is rebounding after the weaker first quarter.”