Latest data released by Markit/CIPS - 23 April 2020
- Prior 34.5
- Manufacturing PMI 32.9 vs 42.0 expected
- Prior 47.8
- Composite PMI 12.9 vs 29.5 expected
- Prior 36.5
That's record lows across all readings as widespread business shutdowns domestically and internationally brings the UK economy down to its knees.
The data collected here is from 7 April to 21 April, so it is all during the peak of the lockdown in the UK as we see business activity plunge dramatically.
According to the report, an estimated 81% of UK service providers and 75% of manufacturing companies reported a fall in business conditions during the month.
Markit notes that:
"The UK economy has been hit by the COVID-19 outbreak in April to a degree far surpassing anything seen in the PMI survey's 22-year history. Business closures and social distancing measures have caused business activity to collapse at a rate vastly exceeding that seen even during the global financial crisis, confirming fears that GDP will slump to a degree previously thought unimaginable in the second quarter due to measures taken to contain the spread of the virus."Simple historical comparisons of the PMI with GDP indicate that the April survey reading is consistent with GDP falling at a quarterly rate of approximately 7%. The actual decline in GDP could be even greater, in part because the PMI excludes the vast majority of the selfemployed and the retail sector, which have been especially hard-hit by the COVID-19 containment measures."Record falls in output across both manufacturing and services are being accompanied by job losses on an unprecedented scale, even if furloughed workers are excluded. Pricing power has also collapsed alongside the slump in demand, leading to the largest drop in average prices charged for goods and services ever recorded by the survey."The dire survey readings will inevitably raise questions about the cost of the lockdown, and how long current containment measures will last. One ray of light came from an improvement in business optimism about the year ahead compared to the all-time low seen in March, as an increased number of companies saw light at the end of the tunnel. Sentiment about the coming year nevertheless remained the second-lowest ever recorded to underscore how few businesses are anticipating a swift recovery."