UK manufacturing PMI weaker, misses estimates in Oct

The manufacturing sector activity in the UK economy deteriorated in the month of October, although remained solid within the expansion territory, well above its long-run average of 51, Markit reports.

The final Purchasing Managers' Index (PMI) in the UK dropped to 54.3 points in Oct, as compared to a previously revised 55.5 reading. Markets had predicted a dip to 54.6.

Key Details:

Upturns in output, new orders and employment continue

Weaker exchange rate raises input costs and new export orders

Highest input prices seen for 69 months

Rob Dobson of Markit commented in the release, “The UK manufacturing sector remained on a firm footing in October and should return to growth in the fourth quarter. Despite slowing from September’s highs, growth of output and new orders continued to defy expectations, rising at marked rates and supporting the fastest job creation in a year.”

“The main topic of the latest PMI survey was, however, the impact of the sterling depreciation on manufacturers. On the positive side, the boost to competitiveness drove new export order inflows higher, providing a key support to output volumes.”