S&P Global UK Manufacturing PMI: UK manufacturing production growth and new orders reach record highs
In two years in May, the UK manufacturing sector returned to growth in May, and production expanded at the fastest pace in more than two years, brightening as positive sentiment for manufacturers rose to its highest level since early 2022, with 63% of companies expecting production to expand during the year. Next.
S&P Global UK Seasonally Adjusted Manufacturing Index: Purchasing Managers’ Index (PMI) rose to 51.2 in May, up from 49.1 in April, the highest reading since July 2022 but a tick below the previous flash estimate of 51.3. is above the neutral 50.0 mark in two out of the past three months. Industrial production expanded at the fastest rate since April 2022, with both sector and company size improving broadly. All three product categories covered by the survey (consumer, broker and investment goods) and all three size definitions (small, medium and large) recorded simultaneous expansions for the first time in more than two years. Production growth was supported by improved intake of new products
Action, stronger market conditions and efforts to complete existing contracts. The level of new business placed with UK manufacturers rose for the second time in the past three months and to the most since April 2022. The rise in demand was concentrated on the domestic market, with new export orders falling for the 28th month in a year and there was a decline in business flows. New from several trading partners, including the United States, the European Union (mentions Germany and Poland) and the Middle East. Which He said the rate of contraction was the weakest in the world
Current sequence of decline (identical to March 2022).
Business confidence has improved alongside the recovery in current market conditions. Manufacturers reported the highest degree of optimism about next year and expectations for production volumes since February 2022 were positive and sentiment was linked to hopes of continued economic recovery, promotional efforts and improving export orders will all support future growth. Companies also cited concerns about political and economic uncertainty (both at home and abroad).
Operating Efficiency and Cost Considerations: Management and lean production remained at the forefront of manufacturers’ decision making during May. While hiring was reduced for the twentieth straight month and inventories of finished goods and purchases were both depleted. Purchases of inputs rose slightly during May, halting 22 months
Sequence of reduced purchasing activity. Supplier deliveries: Times extended for the fifth consecutive month, mainly due to transportation issues such as the ongoing crisis in the red. May saw average input costs increase for the fifth consecutive month, albeit to a lesser extent than in April. Manufacturers reported a wide range of items as prices, including chemicals, metals, paper, polymers, pulp products and wood. Sector data painted a mixed picture of purchasing trends and costs. While producers of intermediate goods saw input prices and costs rise at the fastest rate in about a year and a half
Inflation fell sharply in the consumer goods category. The investment goods sector saw a decline in purchasing costs for the first time in the year so far. After strengthening in each of the past five months, May output price inflation saw its highest levels in a year
The rates of increase accelerated in the consumer and intermediate goods sectors but eased in the investment goods and producers. The S&P Global UK Manufacturing PMI is compiled by S&P Global
Questionnaires were sent to purchasing managers in a panel of approximately 650 manufacturers
It is broken down by detailed sector and company workforce size, based on contributions to GDP. Data collection began in January 1992. Survey responses are collected in the second half of each month and indicate trend change compared to the previous month. A diffusion index is calculated for each survey variable. The index is the sum of the percentage of “top” answers and half of the percentage of “unchanged” answers.
The indicators range between 0 and 100, with a reading above 50 indicating a total increase compared to the previous month, and below 50 a general decrease. Indicators are therefore seasonal. The headline number is the Purchasing Managers’ Index (PMI). The Purchasing Managers’ Index (PMI) is a weighted average
The following five indicators: New Orders (30%), Production (25%), Employment (20%), Supplier Delivery Times (15%) and Purchased Inventory (10%). For calculating the Purchasing Managers’ Index (PMI), suppliers’ delivery times are specified
The indicator is flipped so that it moves in a direction similar to the other indicators. The underlying survey data are not reviewed after publication, but seasonal adjustment factors may be reviewed and revised from time to time as appropriate which will affect the seasonally adjusted data series.
About Standard & Poor’s Global:
S&P Global (NYSE: SPGI) S&P Global provides basic information. We empower governments, businesses and individuals with the right data, expertise and connected technology so they can make decisions with conviction. From helping our clients evaluate new investments to guiding them through ESG and energy transitions across supply chains, we open new opportunities,
Solve challenges and accelerate progress for the world. We are widely sought after by many of the world’s leading organizations to provide credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodities and automotive markets. With each of our shows
About the Purchasing Managers’ Index:
Purchasing Managers’ Index (PMI) surveys are now available for over 40 countries and also for key regions including the Eurozone. They are the world’s most closely watched business surveys, favored by central banks, financial markets and business decision-makers for their ability to provide up-to-date, accurate and often unique monthly indicators of economic trends.
