The latest set of purchasing managers’ indices (PMIs) have been published by UK S&P Global and CIPS Manufacturing, with them beating analysts’ expectations and suggesting that the UK economy may be turning a corner.
The manufacturing PMI is based on taking five indicators. These include output, suppliers’ delivery times, stocks of purchases, employment and new orders and calculating the weighted average. Analysts had been predicting a Manufacturing PMI of 45 for November, barely higher than the 44.8 in October. The PMI instead came in at 46.7. Being under 50, it still represents a contraction, but it at least indicates that the pace of contraction is abating.
The Services PMI also beat analysts’ expectations to return to growth at 50.5 from 49.5 in October. Ebury’s head of strategy, Matthew Ryan, described the data to EuroNews as some positive news, adding:
“The rebound in services activity, in particular, should somewhat allay concerns over the possibility of a UK recession and we remain quietly hopeful that a contraction in GDP will be avoided in the final quarter of the year.”
He added that the slowdown in pressure should give businesses some much-needed relief.
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