UK manufacturing surge slows in March

LONDON: British manufacturing lost some of its momentum last month, as export orders grew more slowly and demand for consumer goods faltered against a backdrop of rising inflation pressures, a survey showed on Monday.

Sterling’s tumble following June’s vote to leave the European Union helped manufacturers enjoy their fastest annual growth in three years during the final quarter of 2016. This capped a year when Britain’s economy grew 1.8 per cent, the secondfastest rate among the world’s main advanced economies.

But financial data company Markit said its purchasing managers’ index (PMI) for the sector suggested manufacturing growth slowed in the first three months of this year.

March’s manufacturing PMI slipped to 54.2 from a downwardly revised 54.5 in February, undershooting economists’ average forecast of 54.6 in a Reuters poll.

The index is well above its long-run average of 51.6, but IHS Markit economist Rob Dobson said the fall — the third in a row since the series hit an 18-month high in December — was likely to herald a further moderation in growth.

“High costs and weak wage growth are sapping the strength of consumers, with rates of expansion in output and new orders for these (consumer) products slowing further,” he said.

A separate survey overnight from accountants Deloitte showed that optimism among chief financial officers of major UK-based businesses was its highest since mid2015, although their appetite for risk was only half the level of before the referendum appeared on the horizon. — Reuters