Strong growth in October has been reported by British manufacturers, following higher domestic demand and export orders. The IHS Markit/CIPS purchasing managers index (PMI) rose to 56.3 in October from 56 in September – a reading that is above 50 indicates expansion.
October was the fifteenth month of expansion for the manufacturing sector and it is expected that the growth will also help to decide whether the economy is ready for an interest rate rise this week. Sterling also rose 0.2% to £1.331, the highest against the dollar since early October, and rose 0.3% compared to the Euro, marking the highest level against the euro zone currency since June.
The latest report said that the UK domestic market was the prime source of new manufacturing orders and more than 50% of manufacturers surveyed said that they expected output to be higher in one year’s time.
This is very positive news and it will be interesting to see what the growth is like in November especially if The Bank of England decides to increase interest rates.