UK Manufacturing Slows to 16 Month Low Ahead of BoE Decision

U.K. manufacturing growth slowed more than expected last month, casting doubt on the strength of the economy as Bank of England policy makers hold their crunch meeting.

IHS Markit’s Purchasing Managers Index for the industry fell to a three-month low of 54 in July, from 54.3 in June, the firm said in a report Wednesday. The reading was below economists’ estimates for a figure of 54.2.



Markit said output growth slowed to a 16-month low, with production of intermediate goods falling for the first time in two years. A weaker expansion of new work from domestic sources offset a stronger increase in export orders, while positive sentiment among manufacturers slid to a 21-month low, amid concerns over Brexit uncertainty and the exchange rate.

“U.K. manufacturing started the third quarter on a softer footing,” said Rob Dobson, director at IHS Markit. “Manufacturing has failed to provide any meaningful boost to headline GDP growth through the year-so-far,” while the data on new orders and business optimism suggest the “industry is unlikely to exit this soft patch in the near future,” he said.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza