UK manufacturing growth continues but pace slows

While lending figures surged at the fastest rate recorded in ten years during the last month of 2015, the news was not quite as positive for Britain’s manufacturing sector, which recorded a decline in growth during the same period.

The news means that the economic recovery is still being fuelled by consumers and the services industry.

According to the Markit/CIPS UK survey, the manufacturing PMI for October stood at 55.5, but this dropped to 52.5 in November and then again to 51.9 in December.

While this still represents growth – with any figure over 50 signalling expansion – Markit claimed that the figure for December marked a “disappointing” end to 2015.

Rob Dobson, senior economist at Markit, said: “[The figures suggest] that industry will make, at best, only a marginal positive contribution to broader economic growth in the final quarter of the year.

“Although this would be an improvement on the second and third quarters, it does also suggest that manufacturing output over 2015 as a whole may be below the level achieved in 2014.”

The Markit survey also revealed that new orders to manufacturers were at the lowest rate recorded for five months at the end of the year, while export orders were also said to have dropped slightly.

However, despite the lower-than-expected 51.9 figure, manufacturing has still expanded over the course of the last three years.

James Smith, from ING, stated that the UK economy continued to perform well and that “the case for a rate hike in 2016 looks very compelling”.