Industry is on the brink of stagnation, says report
Manufacturing in the UK is teetering on the brink of stagnation after expanding at its slowest pace for nearly three years last month, according to a report.
The closely-watched Markit/CIPS manufacturing purchasing managers' index showed the sector barely remained in growth territory, with a reading of 50.8 in February, down from 52.9 in January, amid a fragile UK economy and global slowdown. A reading above 50 indicates expansion.
February's reading was the worst since April 2013 and the report showed weakness in domestic activity as well as falling exports in the latest sign of global economic woes.
But it is hoped that the recent falls in the value of the pound will provide a much-needed boost to manufacturers as it makes British goods more attractive to buyers.
Graeme MacLaughlin, relationship director at Barclays in Northern Ireland, said: "The weak start to the year continues for the manufacturing sector, with even domestic demand unable to contribute to the levels it has done previously.
"However, amid the headwinds of slowing global growth, uncertainty over a Brexit and skills shortages in the industry, comes the recent depreciation in sterling which may just provide the jump-start that manufacturing exporters need to boost exports and put a spark back into the sector's performance."
Rob Dobson, senior economist at Markit, said: "The near-stagnation of manufacturing highlights the ongoing fragility of the economic recovery at the start of the year. The breadth of the slowdown is especially worrisome. The domestic market is showing signs of weakening, while export business continued to fall."
The report showed new export business placed with UK manufacturers dropped for the second straight month in February, with firms reporting weaker orders from Brazil, Europe, Russia and the US.