U.K. Manufacturing Grows as Sector Starts Long Road to Recovery
U.K. manufacturing grew at the fastest pace in almost three years in July as the nation’s lockdown eased.
(Bloomberg) -- U.K. manufacturing grew at the fastest pace in almost three years in July as the nation’s lockdown eased, although economists warned the sector still faces an arduous road to recovery.
IHS Markit’s Purchasing Managers Index for the industry climbed to 53.3 from 50.1 in June, the company said Monday. That’s slightly below a flash estimate, but still well above the 50 level that indicates growth.
Still, Markit cautioned that the economic recovery will take time, potentially boosting concerns that the pandemic will have a longer-term scarring impact on the economy
“Despite the solid start to the recovery, the road left to travel remains long and precarious,” said Rob Dobson, director at Markit. “An extended period of growth is still needed to fully recoup the ground lost in recent months. This is also the case for the labor market, where job losses are continuing despite businesses reopening.”
The increase in July was driven by a sharp rise in domestic orders, although new export business fell.
The report may sharpen debate among Bank of England officials over the strength of the nation’s economic rebound. Policy makers are due to announce their latest forecasts and decision on Thursday.
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