Double-dip concerns as manufacturing takes hit
Manufacturing activity sank to a 26-month low in August, a key survey revealed yesterday, fuelling fears of a double-dip recession in the UK.
The Markit Purchasing Managers' Index (PMI) recorded a level of 49 for August - a reading above 50 indicates growth - down from a reading of 49.4 in July.
The volume of new orders declined for the fourth month running in August, recording the sharpest fall since April 2009 and painting a bleak picture on the outlook for industry.
Samuel Tombs, UK economist at Capital Economics, said: "All in all the survey highlights the increasing risk that the industrial sector - and perhaps even the overall economy - is heading for a double-dip."
The dismal figures will come as a blow to Chancellor George Osborne, who is banking on the private sector to keep the economy afloat as he rolls out a package of spending cuts in the public sector.
The manufacturing sector had until recently been the bright spot of the economy, but it has suffered a downturn in recent months.