UK August manufacturing PMI 47.4 vs 48.4 expected
Latest data released by Markit - 2 September 2019
- Prior 48.0
Yet another drop in factory conditions with the headline print being the weakest since July 2012. Looking at the details, the future manufacturing output component and business confidence both fell to its weakest levels on record.
Meanwhile, new export orders continue to contract at their fastest rate in over seven years amid ongoing trade tensions and Brexit uncertainty. Markit notes that:
"High levels of economic and political uncertainty alongside ongoing global trade tensions stifled the performance of UK manufacturers in August. Business conditions deteriorated to the greatest extent in seven years, as companies scaled back production in response to the steepest drop in new order intakes since mid2012. Based on its historical relationship against official ONS data, the latest PMI Output Index is consistent with a quarterly pace of contraction close to 2%. The outlook also weakened as the multiple headwinds buffeting the sector saw business optimism slump to a series-record low."
That's certainly not welcome news for the UK economy as it looks to be sitting on a brink of a technical recession at this point. The pound continues to hold at its weakest levels on the day with cable around 1.2100, weighed lower by political uncertainty.