Investing.com - Activity in the UK manufacturing sector accelerated slightly last month, but remained subdued as new export business dropped for a second straight month, according to a closely watched business survey released on Monday.
Research firm IHS Markit said its manufacturing purchasing managers’ index rose to 53.1 in November, up from October’s 27-month low of 51.1.
That was better than forecasts of 51.6, but was still among the weakest readings registered over the past two-and-a-half years.
The increase came as companies moved to stockpile products to guard against possible supply disruptions after Brexit.
“The November PMI provided a lackluster picture of the UK manufacturing sector, as ongoing global trade tensions and Brexit uncertainty weighed on current business conditions and dampened the outlook for the year ahead,” IHS Markit director Rob Dobson said.
“Based on its relationship against official ONS data, the survey indicators suggest manufacturing output is on course to make no contribution to GDP growth in the final quarter, with a clear risk of output contracting unless December proves a stronger month.”
The level of new export business dropped for the second straight month in November, the first back-to-back contractions since early-2016, with companies citing ongoing Brexit uncertainty as the reason for the declines.
Employment in the sector picked up slightly after a weak month in October, but the overall degree of business optimism dipped to a 27-month low, as Brexit uncertainty, exchange rate concerns and a slowing economy weighed on confidence.