EEF comment on PMI data

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Commenting on today’s PMI data, Ms Lee Hopley, Chief Economist at EEF, the manufacturers’ organisation, said:

“Today’s data confirm that UK manufacturers are looking beyond the Brexit negotiations to strengthening market opportunities in Europe and beyond, with the acceleration in manufacturing activity in August helping to provide some welcome offset to sluggish consumer demand at home.

“With the eurozone PMI hovering at a seventy four month high and sterling hitting  eight-year lows last month, the buoyant demand picture seen across manufacturing supply chains is not surprising. As companies are translating these buoyant trading conditions into more jobs and increased investment plans, it seems that confidence levels are a far cry from levels reported a year ago.

“However, inflationary pressures from recent exchange rate movements and shortages of some inputs aren’t quite beyond us yet, something the Bank of England will be paying close attention to. The raft of decent survey data from the sector suggest manufacturing output growth should look better in the second half of this year than it did in the first, but longer term the continued robustness of demand in the rest of the world and the right investment decisions at home to capitalise on it will be key to sustaining this picture.”

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