UK manufacturing growth picks up in May

News from BBC
Manufacturing growth picked up slightly in May, a survey has indicated, with a strong domestic market helping to offset weak overseas demand.
Markit said its monthly UK Purchasing Managers’ Index (PMI) for manufacturing rose to 52 in May from 51.8 in April.
Although a figure above 50 still indicates expansion, May’s increase was weaker than analysts had expected.
April’s reading had marked a seven-month low for the sector, which has been hit by weak exports.
Markit senior economist Rob Dobson said the readings “called into question” expectations of a broad rebound in UK economic growth in the second quarter.

“Manufacturing looks on course to act as a minor drag on the economy, as the sector is hit by a combination of the strong pound and weak business investment spending,” he added.
Manufacturing represents about 10% of the UK economy.
The PMI survey follows research from the engineering and manufacturing employers’ body EEF, which said its latest survey of firms showed demand for goods in the UK had weakened in the past few months, as exports remained flat.
Lee Hopley, EEF chief economist, said that manufacturing was still growing.
However, she said it was not expanding “at the pace anticipated at the beginning of the year”.

“The sector is still in positive territory, but the ground is looking a lot less firm beneath its feet,” she added.
“Much of this weakening is down to the impact of the decline in oil and gas activity on the supply chain.”
Ms Hopley said the “weakening trend” could continue to the end of the year.
“The sector has seen a good run of not only growth, but employment, investment and productivity gains over the past couple of years and it’s vital that the new government takes all necessary steps to enable this to continue into the future.”
The EEF represents a quarter of the UK’s manufacturers.

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