U.K. manufacturing PMI falls more than expected in June

Combination of market graph and market list data

Investing.com -

Investing.com - Manufacturing activity in the U.K. fell more than expected in June, causing concern over the British economy at the end of the second quarter, industry data showed on Monday.

In a report, market research group Markit said that its U.K. manufacturing PMI fell to a seasonally adjusted 54.3 last month from a final reading of 56.3 in May.

Analysts had expected the PMI to decline to 56.5.

On the index, a reading above 50.0 indicates industry expansion, below indicates contraction.

Markit noted that the headline number hit a three-month low while the growth rates of output and new orders slowed.

The research group also highlighted that price inflationary pressures eased.

"The UK manufacturing sector largely weathered the uncertainty of a general election and start of formal Brexit negotiations to eke out further output growth at the end of the second quarter," Rob Dobson, senior economist at survey compiler Markit, said.

"However, the rate of expansion eased again in June, with growth weakening across the consumer, intermediate and investment goods industries," he added.

Dobson explained that the main factor driving the broad slowdown in June was a steep easing in the rate of increase in new order intakes.

"While the survey data add to signs that the economy is likely to have shown stronger growth in the second quarter, further doubts are raised as to whether this performance can be sustained into the second half of the year," he concluded.

After the report, GBP/USD was trading at 1.2972 from around 1.2988 ahead of the release of the data, EUR/GBP was at 0.8775 compared to 0.8764 prior to the report, and GBP/JPY traded at 146.41 compared to 146.61 earlier.

Meanwhile, European stock markets were trading higher. London's FTSE 100 rose 0.55%, the Euro Stoxx 50 gained 0.98%, France's CAC 40 advanced 1.10%, while Germany's DAX traded up 0.72%.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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