British manufacturers enjoyed a pickup in business last month but they relied on domestic demand as exports fell against the backdrop of a troubled eurozone and stronger pound.
A closely watched survey showed factories continued to enjoy a bounceback after a slow finish to 2014. But details showed little progress in the government’s push to rebalance the economy away from over-reliance on domestic consumer demand.
The main balance rose to a seven-month high of 54.1 in February’s Markit/CIPS UK Manufacturing PMI. That was up from 53.1 in January and well above the 50-mark that separates expansion from contraction. It was also higher than the 53.4 consenus forecast in a Reuters poll of economists.
The report showed manufacturers continued to add jobs to keep up with rising demand from UK-based clients. But export orders fell as a stronger pound made UK goods more expensive for some foreign buyers and as worries about deflation and Greece’s debt deal continued to weigh on confidence in the UK’s key market, the eurozone.
