LONDON (dpa-AFX) - The UK factory sector deteriorated at a slower pace in June as the decline in output, new orders, and employment moderated, the purchasing managers' survey results from S&P Global showed on Tuesday.
The final manufacturing PMI rose to a five-month high of 47.7 in June, as estimated, from May's nearly 18-month low of 46.4. However, the score remained below the neutral level of 50.0, suggesting contraction.
Both output and new orders continued to decline in June amid weak market conditions, clients offsetting higher costs through reduced demand, and uncertainty surrounding government policy, tariffs, and the general economic or geopolitical situation. Nonetheless, the rate of contraction was eased in both cases.
Lower new order inflows were witnessed both in domestic and foreign markets. New export orders fell for the forty-first month in a row amid reports of reduced demand from the US, Europe, and China.
Consequently, firms reduced their workforce numbers for the eighth successive month, with job cuts seen across all product categories. The decrease in employment was due to further contraction in backlogs of work.
On the price front, input prices rose for the eighteenth straight month, linked to higher supplier prices, general inflationary pressures, shipping disruption, and heightened geopolitical tensions. However, both input and output price inflation eased in June.
Looking ahead, manufacturers remained confident about production expectations over the year ahead amid hopes for a sales recovery, new product launches, efforts to move into new markets, investment spending, organic growth opportunities, planned business expansions and diversifications.
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