British manufacturing activity hits two-year high
British manufacturing activity hits two-year high
08:26, November 03, 2009 
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The British manufacturing activities grew at its fastest rate in recent two years in October because new orders increased at their fastest in almost six years, according to the CIPS/Markit survey released on Monday.
After stalling in the last couple of months, the purchasing managers index (PMI) of manufacturing activity rose to 53.7 in October, reaching its highest level since November 2007 and 3.8 percentage points higher than that of the previous month, the report showed. This is the third-highest one-month rise in the survey on record.
"It appears that the manufacturing sector has turned a corner and is starting to pull itself out of recession," said David Noble, chief executive at the Chartered Institute of Purchasing and Supply (CIPS), which sponsors the survey.
The improvement for the manufacturing sector in October was driven by a surge in new orders, with the index climbing up to 59.5, 6.8 percentage points higher than that of the previous month and the highest since January 2004.
But the rise in the new orders index in October was driven mainly by domestic orders. The survey showed that the export orders index actually slipped from September's 51.5 to 50.9, suggesting that British firms have yet to feel much benefit from the weaker pound and global recovery.
The survey also showed that the input prices index of the manufacturing sector rose to its highest in 13 months, because the weak pound led to higher raw materials cost. But the output prices index rose modestly to stand just below the 50-level.
The survey suggested that the industrial recovery remains on track and provided some early hope that the British economy will finally emerge from recession in the fourth quarter of this year, said Jonathan Loynes, chief European economist from Capital Economics.
However, the CIPS/Markit survey had some conflicts with the recent worse-than-expected official GDP figures released by the Office for National Statistics. Some economists believed that the office would likely revise upward.
"But underlying concerns over the strength and sustainability of the economic recovery should still see the Bank of England announce a sizable extension to its quantitative easing program on this Thursday," said Loynes.
Source:Xinhua
After stalling in the last couple of months, the purchasing managers index (PMI) of manufacturing activity rose to 53.7 in October, reaching its highest level since November 2007 and 3.8 percentage points higher than that of the previous month, the report showed. This is the third-highest one-month rise in the survey on record.
"It appears that the manufacturing sector has turned a corner and is starting to pull itself out of recession," said David Noble, chief executive at the Chartered Institute of Purchasing and Supply (CIPS), which sponsors the survey.
The improvement for the manufacturing sector in October was driven by a surge in new orders, with the index climbing up to 59.5, 6.8 percentage points higher than that of the previous month and the highest since January 2004.
But the rise in the new orders index in October was driven mainly by domestic orders. The survey showed that the export orders index actually slipped from September's 51.5 to 50.9, suggesting that British firms have yet to feel much benefit from the weaker pound and global recovery.
The survey also showed that the input prices index of the manufacturing sector rose to its highest in 13 months, because the weak pound led to higher raw materials cost. But the output prices index rose modestly to stand just below the 50-level.
The survey suggested that the industrial recovery remains on track and provided some early hope that the British economy will finally emerge from recession in the fourth quarter of this year, said Jonathan Loynes, chief European economist from Capital Economics.
However, the CIPS/Markit survey had some conflicts with the recent worse-than-expected official GDP figures released by the Office for National Statistics. Some economists believed that the office would likely revise upward.
"But underlying concerns over the strength and sustainability of the economic recovery should still see the Bank of England announce a sizable extension to its quantitative easing program on this Thursday," said Loynes.
Source:Xinhua
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