PwC comments on the S&P Global UK Manufacturing PMI

Commenting on the S&P Global UK Manufacturing PMI® for March, 

Cara Haffey, Manufacturing and Automotive lead at PwC UK said:

“Positive signs for the sector were demonstrated in March, with the PMI posting 50.3 - a 20-month high and the first time the reading has posted above 50.0 (showing growth) since July 2022. It’s interesting to compare domestic growth versus exports and international markets - with the PMI noting the uptick in new business inflows was centred on domestic markets, whereas new export orders remained weak in comparison. 

“With overseas demand falling for the twenty-sixth successive month, this could possibly signal the relative stability being provided to domestic markets with falling rates of inflation compared with the ongoing disruption for manufacturers with global vendors and supply chains, which continue to deal with delays to lead times and shipping routes due to continued geopolitical disruption. If domestic growth remains strong in comparison, it will be interesting to see if we observe a trend in the re-shoring of supply chains and operations as part of efforts from manufacturers to insulate themselves from logistical disruptions.

“Manufacturers may well be starting to see their optimism come to some fruition, which proved resilient once again in March. The PMI noted that sector optimism rose to its highest level since April 2023, with 58% of manufacturers expecting their level of production to increase over the coming 12 months. PwC’s executive survey carried out with Make UK earlier this year showed that a little under a third of manufacturers cited rebounds in activity if interest rates cooled as the largest opportunity for their business in 2024 - so initial signs of easing in the domestic economic landscape will be key in reassuring investment and enabling growth.”