Thursday, 1 December 2011

Manufacturing and output continues to fall in the UK

More bad news on the economy as manufacturing output has shrunk to its lowest level since June 2009.

November was the second successive month that output from Britain's factories fell with weak global demand being blamed.

Output also fell last month at the fastest pace in more than two years and new orders contracted for a fifth straight month although at a slower pace than in October.

The Markit/CIPS Manufacturing Purchasing Managers' Index (PMI) fell to 47.6 in November, its lowest level since June 2009, from an upwardly revised 47.8 in October.

The index, which was below the 50 mark that indicates growth in activity for a second month running, came in a touch above forecasts for a reading of 47.0.

Part of the reason is that manufacturers have been running down inventories to cut costs.These helped prop up economic growth in the third quarter and the running down will have a profound effect on growth in the fourth quarter.

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