PMI drops in September

Posted on 1 Oct 2012 by The Manufacturer

August’s slight recovery in PMI performance failed to sustain in September with manufacturing activity dropping to 48.4.

The September figures from the Markit/CIPS Purchasing Managers’ Index survey fell from 49.6 in August.

This decline was greater than some economists had expected though contraction had been anticipated.

Continued uncertainty in the eurozone was blamed for the inability of manufacturing output to increase, though falling orders from Asia also made an impact.

Markit chief economist Chris Williamson said: “Overseas sales continue to be hit by the ongoing deterioration in global economic growth, with the eurozone – the UK’s largest export market – at the epicentre of the weakness.”

Lee Hopley, chief economist at EEF agreed saying, “It remains a challenging year for UK manufacturers. The lower PMI reading indicates that on-going strength in orders from the emerging markets and the U.S. is not counteracting the weakness in European markets.”

Searching for positives in the Market/CIPS data however, Ms Holey went on, “The overall orders balance did increase and demand for consumer goods may indicate that as inflation in the UK continues to ease, we could see stronger domestic demand in the final quarter of the year.”

On average, the PMI data for the third quarter (47.7) showed the lowest performance since Q2 2009.