MNI: UK June Manuf Output A Touch Up From May: IHS Markit

--UK June Manufacturing PMI 54.4 Vs 54.3 in May

     LONDON (MNI) - UK manufacturing sector activity edged higher in June, the

latest IHS Markit/CIPS Purchasing Managers' Index (PMI) showed.

     The headline manufacturing PMI moved up 0.1 points to 54.4 in June from

May's downwardly revised 54.3 (originally 54.4). After May's rebound from

April's 17-month low, June's slight movement upward illustrates fairly subdued

manufacturing activity. It is worth noting that the 54.4 figure is four points

below the 51-month high reached in November 2017.

     According to IHS Markit, output growth moderated, with new order growth

accelerating only mildly. Some companies attributed higher output being

sustained through inventory building and clearing backlogs of work. Sectoral

data shows that the rise in output and new orders was most pronounced across the

consumer, intermediate and investment goods industries.

     Incoming new business rose at the fastest pace in three months, but

nonetheless remained among the weakest readings registered over the past 18

months. Increases in new export business were driven by a pick up in sales to

mainland Europe, North America, China, South America and Australia.

     After job creation lost momentum in May, June saw a recovery with staffing

levels rising at the quickest pace for three months. As expected, the sectors

which saw a rise in output and new orders (consumer, intermediate and

investment) were the sectors accounting for the job creation.

     Input cost inflation accelerated to a four-month high in June, with

companies reporting a wide range of inputs as having risen in price. Some

companies noted that this was exacerbated by shortages of certain raw materials,

with part of the rise being passed on through higher selling prices.

     "The UK manufacturing sector ended the second quarter on a subdued footing.

The turnaround in performance since the start the year has been remarkable, with

impressive growth rates late last year turning into some of the weakest rates of

expansion seen over the past two years in recent months," Rob Dobson, Director

at IHS Markit, said.

     Duncan Brock, Group Director at the Chartered Institute of Procurement and

Supply added: "A gentle hush descended over the sector in June as growth of new

orders was among the lowest in 18 months... This diminishing strength in the

sector will be a setback, but with an increase in hiring and continued optimism

resulting in new products and markets, the sector may yet beat the Brexit

blues."

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; +44 207-862-7489; email: ukeditorial@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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