UK Jan manufacturing PMI in marginal dip
Index dipped from a level of 51.2 in Dec to 50.6 in Jan
By Gaurav Sharma | CFO UK | Published 12:12, 01 February 13
The UK's manufacturing Purchasing Managers' Index (PMI) saw a marginal dip from a level of 51.2 in December to 50.8 in January, according to figures published by the Chartered Institute for Purchasing and Supply (CIPS) and Markit.
While a level of above 50 indicates a rise in activity, the manufacturing PMI has remained stuck around the 50 mark since the mid-2011. However, CIPS/Markit noted that a second consecutive month of improving business conditions in the manufacturing sector is an "encouraging start" to 2013.
Rob Dobson, economist at Markit, said, "Companies reported that output growth fathered further momentum, reaching a 16-month high, suggesting that the sector could help lift the economy from the slide back into contraction late last year."
In response, Howard Archer, chief UK economist at IHS Global Insight, said the January manufacturing PMI level provides limited support for hopes that the UK economy can return to growth in the first quarter of 2013.
"There are no indications in the survey that the snow had a major dampening impact on manufacturing activity…The overall impression is that the manufacturing sector may be past the worst after a pretty torrid 2012, but it still has its work cut out to return to sustainable decent growth in the face of ongoing challenging domestic and international conditions," he told CFOWorld.
Philip Shaw, economist at Investec, said the news chimes broadly with other surveys which are saying that UK manufacturing is getting back onto its feet again.
"Broadly the findings argue against the UK going into a triple-dip recession and most significantly offer hope that a more sustainable recovery might be in train," he added.
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