Growth in Britain's factories was the slowest in a year in July amid mounting fears that tension between Russia and the west might start to weigh on manufacturing exports.
Slowing expansion of manufacturing output, orders and job creation dragged the Markit/CIPS PMI headline index down to 55.4 in July, from 57.2 in June, disappointing expectations that it would remain above 57, and the lowest since July 2013.
However, given anything above 50 indicates growth, the survey suggested British manufacturing was in still in decent shape last month.
A slight cooling of Britain's economic recovery has been predicted by the Bank of England, which is forecasting modestly lower growth in the third and fourth quarters than the 0.8% rate achieved in the first and second quarters.
Fears are rising however that external tensions such as Russia's dispute with the west over Ukraine might exacerbate a slowdown in the UK if it starts to weigh on the economy in Europe – Britain's biggest trading partner.
Rob Dobson, senior economist at Markit, said: "The Bank of England will also not be overly worried by the weaker numbers. Policymakers were expecting growth to slow slightly from the impressive rate seen in the first half of the year.
"The concern is that the slowdown we are seeing is also a symptom of increased economic uncertainty both at home and in key export markets of Europe, in turn fuelled by worries about the Ukraine crisis.
If the situation with Russia deteriorates further, we should expect goods exports to come under further pressure."
New export order growth was the slowest in four months according to the manufacturing PMI, falling to 53.9 in July from 55.6 in June.
James Knightley, economist at ING, said the weaker July survey probably reflected concerns about the impact of the situation in Russia, the prospect of a UK interest rate rise, and the recent strength of the pound.
theguardian.com
Slowing expansion of manufacturing output, orders and job creation dragged the Markit/CIPS PMI headline index down to 55.4 in July, from 57.2 in June, disappointing expectations that it would remain above 57, and the lowest since July 2013.
However, given anything above 50 indicates growth, the survey suggested British manufacturing was in still in decent shape last month.
A slight cooling of Britain's economic recovery has been predicted by the Bank of England, which is forecasting modestly lower growth in the third and fourth quarters than the 0.8% rate achieved in the first and second quarters.
Fears are rising however that external tensions such as Russia's dispute with the west over Ukraine might exacerbate a slowdown in the UK if it starts to weigh on the economy in Europe – Britain's biggest trading partner.
Rob Dobson, senior economist at Markit, said: "The Bank of England will also not be overly worried by the weaker numbers. Policymakers were expecting growth to slow slightly from the impressive rate seen in the first half of the year.
"The concern is that the slowdown we are seeing is also a symptom of increased economic uncertainty both at home and in key export markets of Europe, in turn fuelled by worries about the Ukraine crisis.
If the situation with Russia deteriorates further, we should expect goods exports to come under further pressure."
New export order growth was the slowest in four months according to the manufacturing PMI, falling to 53.9 in July from 55.6 in June.
James Knightley, economist at ING, said the weaker July survey probably reflected concerns about the impact of the situation in Russia, the prospect of a UK interest rate rise, and the recent strength of the pound.
theguardian.com
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