UK manufacturers' new export orders fell in October at the fastest pace since January 2013, amid weakness in eurozone market-places, a survey has revealed.
But the survey, published yesterday by the Chartered Institute of Purchasing and Supply, showed an unexpected pick-up in the rate of growth of overall UK manufacturing activity in October. CIPS's previous monthly survey had shown expansion of overall manufacturing activity had, in September, slowed further to its weakest pace in 17 months.
CIPS's headline purchasing managers' index for UK manufacturing, which measures changes in output, new orders, employment, suppliers' delivery times and stocks of goods purchased, rose from 51.5 in September to 53.2 in October on a seasonally-adjusted basis.
But CIPS's new export orders index fell from 49.6 in September to 48.3 in October. This took if further below the level of 50, which separates expansion from contraction, to signal the fastest decline since January last year.
The survey signalled a slowing of the rate of employment growth in UK manufacturing between September and October. CIPS noted employment had shown its second-weakest monthly pace of growth since June of last year.
Addressing the fall in export orders, CIPS says: "The latest decline in foreign demand for UK manufactures was centred on the eurozone. Slower growth in other key markets, such as the US and China, [was] also mentioned by some companies."
Rob Dobson, senior economist at survey compiler Markit, said: "Although the pace of expansion remains below that seen at the start of the year, suggesting the sector will remain only a modest contributor to broader economic growth, it is positive to see the sector break its recent sequence of slower growth."
He viewed the resilience of the domestic market-place in October as a positive.
However, he added: "This was partly offset by a further drop in new business from overseas, as exporters were hit by a near-stagnant eurozone and a relatively strong euro-sterling exchange rate. Reports from companies mentioning slower inflows of new business from markets such as the US and China also paint a less than rosy picture for exports."
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