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Macroeconomics  |  August 01, 2012 14:23:00

UK manufacturing sector in July unexpectedly weakened sharply

UK manufacturing sector fell at the beginning of the third quarter to its lowest level since May 2009. According to data Markit / CIPS PMI index of activity dropped to 45.4 points from a revised 48.4 points in June and stayed for the third month of contraction. The result of the survey fell behind expectations, the majority 48.4 points. In the second quarter average PMI fell to 48.2 points and was the lowest since Q2 2009th

Production of the recovery slowed sharply in June due to the decline of domestic and foreign demand. The decline was steepest in the last 40 months.Slowed production of intermediate goods and capital goods, only slightly increased production of consumer goods. New orders declined for the fourth month in a row, new export orders posted their biggest decline since February 2009. Corporations frequently mentioned the weak demand in the euro area countries and in Asia. Employment in manufacturing during the first three months increased slightly. Firms hired more staff to complete the existing contracts and also as part of a planned expansion.Average input prices fell for the second month in a row, reflecting lower prices of chemical raw materials, oil and metals. Average prices of finished goods continued to grow moderately, manufacturers reflected higher raw material prices at the beginning of the year.

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