Stephen Cooper, KPMG’s UK head of manufacturing, comments on the Markit/CIPS Manufacturing Purchasing Managers' Index (PMI), which fell for the second successive month to 47.5 in October:
“The UK PMI figures are not good news, but not unexpected. The Eurozone, which is still the UK’s biggest export market, has major issues to resolve which will make Eurozone buyers cautious.
“Looking globally, the US manufacturing sector has shown recent modest expansion, but the US economy still has significant fiscal issues which need to be resolved. Next week’s election result will impact on how this is done in coming months.
“In Asia, weaker orders are not unexpected given a number of recent corporate earnings warnings from UK manufacturers. On the other hand, the small rise in China’s latest PMI offers a glimmer of hope as it suggests that factory output is accelerating again, which may mean better economic performance for Asia in coming months, and may link through to an increase in UK exports to Asia.
“The manufacturing sector is contending with challenging domestic and global factors at an uncertain and fragile time for the UK economy. However, while conditions remain tough in the UK, overall there are some global shifts in the right direction.”
Ends
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About KPMG
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 11,000 partners and staff. The UK firm recorded a turnover of £1.7 billion in the year ended September 2011. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 152 countries and have 145,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.
