High inflation, strong growth, but weakening confidence

Highlights from the PMI:

• Inflation second fastest "for more than 2 decades" (only faster in Nov 2021)
• "New business received by UK private sector firms increased sharply in March, although the rate of growth eased from February's eight-month peak." Manufacturing saw weakest new orders expansion since Feb 2021, however.
• Employment strong
• Supply chains: "Supplier delays the least widespread since October 2020. However, survey respondents continued to note that shortages of raw materials, staff absences and shipping delays had held back production growth."
• Weak confidence however: "Sharp drop in business optimism. The index dropped from 76.1 in February to 71.4 in March, to signal the lowest level of confidence since October 2020. Moreover, the monthly fall in business expectations (down 4.7 index points) signalled by far the greatest setback since the start of the pandemic and reflected much weaker year ahead growth projections in both the manufacturing and services sectors. "