UK manufacturing sector suffers ‘near stagnation,’ says survey

Domestic and export activity were equally lacklustre

'The near-stagnation of manufacturing highlights the ongoing fragility of the economic recovery,' according to a leading financial data provider (Getty)

Britain’s manufacturing companies are in “near-stagnation”, according to the latest survey snapshot of the sector. The Markit/Cips activity index for February fell to 50.8, its lowest level in 34 months and down from 52.9 in January. It is now only just above the 50 mark that separates growth from contraction.

Rob Dobson of Markit, the financial data provider, said the signs of manufacturing distress would encourage the Bank of England to keep interest rates on hold at 0.5 per cent. “The near-stagnation of manufacturing highlights the ongoing fragility of the economic recovery.” he said .

Domestic and export activity were equally lacklustre, the survey revealed, with companies reporting weaker orders from Brazil, Europe, Russia and the US. There were also job losses for a second successive month. But some economists said the recent fall in the pound could help exporters. “The recent drop in sterling... offers one ray of light for the ‘makers’,” said Martin Beck of the EY Item Club.