Manufacturing sector sustains growth
By: David Howells
04 May 2011
The UK's manufacturing sector registered an expansion in April, maintaining its position as one of the strongest sectors in the UK's economic recovery.
A figure of over 50 on the purchasing manager's index (PMI) means that the industry is growing, whereas anything below signals contraction. Whilst April's figure of 54.6 was nowhere near the record breaking sum of 61.7 per cent attained in January, it still showed a growth in the logistics work sector whilst others were suffering.
The PMI figure for the manufacturing sector has now registered growth for 21 consecutive months.
The exact figures show a decline in new orders, falling from 65.2 to 51.5, however, output has registered a stronger result, achieving 56.5. Output prices remained close to the peak experienced during March, remaining relatively unchanged.
James Knightley from ING Financial Markets told BBC News that whilst the figure has dropped, the outlook is still good for the industry. "There was a dip in the prices component," he said, "but it is still the third highest index reading since the markets began in 1999."
Investec's Phillip Shaw was keeping an open mind about the results, suggesting that any number of reasons could be given for the slowing of growth. He told Reuters, "It's unclear whether the drop in the index reflects a genuine slowdown in demand for manufactured goods or whether it reflects a degree if supply disruption from the tsunami in Japan in March."
"For now, even at 54.6, the level of the PMI continues to indicate healthy expansion in manufacturing output."
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