teknolojiarsivi.com
teknolojiarsivi.com December 15, 2017


Inflation squeezes United Kingdom manufacturing growth while eurozone factories power ahead

03 October 2017, 08:11 | Vickie Mathis

Molten bottles at the Verallia glass factory in Albi southern France Getty Images

Molten bottles at the Verallia glass factory in Albi southern France

Currency weakness was reportedly the main reason leading to higher input costs (the rupiah being under pressure - like other emerging market currencies - amid renewed United States dollar strength). A gauge for employment rose at the fastest pace since the survey began in 1997.

The British pound weakened against other major currencies in the European session on Monday after data showed that the United Kingdom manufacturing sector continued to expand in September, albeit at a slower pace compared to August. "Surging order-book growth has encouraged manufacturers to take on extra staff at a rate never previously seen in the 20-year history of the PMI survey".

The soaring PMI was attributed to the growing consumption demand, which led to an increase in output, new orders and employment. Quantities of purchases increased amid reports of efforts to replenish stocks in line with forecasts of further improvements in demand. The increase in input costs was the strongest since May 2011.

After declining in August, export orders increased last month even as "the degree of expansion was the mildest since the survey started in January previous year".

On the price front, firms faced sharp cost pressures, but were unable to fully pass these on to consumers due to competitive pressures.


"This is also happening alongside rising commodities prices, which are contributing to inflationary pressures across the supply chain".

Ai chief executive Innes Willox says the recovery in manufacturing activity is continuing, but conditions appear to be moderating.

Optimism is still relatively strong, with more than 51% of firms expecting production to rise over the coming year, reflecting worldwide expansion efforts, efficiency drives and fresh investment plans. Manufacturers need to look at their business processes, costs and overall performance to ensure they can improve efficiency and risk management. "We expect this to continue in the coming months".

"Order book gains continued to underwhelm relative to the historical trend - even as exports returned to growth - which weighed on hiring".

The currency bloc's economy is on track to expand 2.2 percent this year, the strongest pace in a decade as global trade, central bank stimulus and political risks all combine to support growth.



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