UK Preliminary Data F'casts: Aug Markit/CIPS Manufacturing PMI

By Jamie Satchithanantham

     LONDON (MNI) - Growth in the UK manufacturing is seen little changed in

August, slipping marginally from July levels, a survey to be released Friday is

expected to show.

     Last month, the IHS Markit/CIPS Manufacturing PMI, picked up to 55.1 from

54.2 in June.   

     According to Markit, manufacturers reported "stronger inflows of new work,

higher levels of production, improved job creation, longer supplier delivery

times and a slight increase in inventory holdings", all assisted by strong

export performances which rose by the second highest rate in the the survey's

history.

     Despite this, the rate of expansion of manufacturing production did ease to

its lowest level since March. 

     Of the analysts polled thus far, the general consensus is that there was

probably not any material change in manufacturers' fortunes in August. The MNI

median stands at 55.0, virtually unchanged from July's result, with only Credit

Suisse pencilling in a bigger move (they see the PMI dropping to 54.5, in line

with the level set in June).  

---------------------------------

                              Aug

                    Manufacturing

                              PMI

                            Index

Date Out                    1-Sep

Median                       55.0

Forecast High                55.1

Forecast Low                 54.5

Standard Deviation            0.2

Count                           6

Prior                        55.1

Capital Economics            55.0

Credit Suisse                54.5

Commerzbank                  55.0

Investec                     55.1

Nomura                       55.0

Oxford Economics             55.0

     Survey data and official data have not moved hand-in-hand in recent months

with the former consistently coming in more bullish.

     The CBI Industrial Trends survey, released Tuesday, again posted results on

the optimistic side. The total order balance rose three points to +13 while the

export order balance rose 9 points to +11.

     The latest official data, meanwhile, had manufacturing output down 0.6% on

the quarter, subtracting 0.1pp from the 0.3% q/q growth in gross domestic

product. 

     As such, the latest batch of data will help those trying to decipher

whether the surveys simply lead the official data, with a rebound in activity

set in Q3, or whether their relationship is starting to break down.  

--MNI London Bureau; +44 203-586-2226; email: jamie.satchithanantham@marketnews.com

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