UK PMI Construction rose to 54.7 in November, up from 53.1, well above expectation of 52.3. Markit noted that house building remained the best-performing category. New order growth was highest for just over six years. But stretched supply chains led to rising costs.

Tim Moore, Economics Director at IHS Markit: “UK construction output stayed on a recovery path in November and there were signs that the main growth driver has transitioned from catch-up work to new projects. The latest increase in new orders was the strongest since late-2014, with construction firms reporting a boost from rising client confidence and the release of budgets that had been held back earlier in the pandemic.”

Full release here.

UK PMI Manufacturing was finalized rose to 65.6 in May, up from April’s 60.9, record high. Production growth strengthened as new work intakes rose at record rate. Output prices and input costs rose at unprecendented rates.

Rob Dobson, Director at IHS Markit, said:

“The UK PMI surged to an unprecedented high in May, as record growth of new orders and employment supported one of the steepest increases in production volumes in the near 30-year survey history. Growth is being boosted by the unlocking of economies from COVID restrictions and ongoing vaccination programs. This is being felt across the globe, as highlighted by a record rise in new export business during the latest survey month.

“The corollaries of this strong upsurge in industrial activity are increased strain on supply chains and a build-up of price pressures. Supplies of inputs into manufacturers and finished goods on to clients are both being severely disrupted by raw material shortages, port issues, COVID restrictions, post-Brexit difficulties and market forces as demand outstrips supply. Suppliers’ delivery times subsequently lengthened to one of the greatest extents on record, while input costs and selling prices both rose at unprecedented rates. With little sign of supply pressures receding, these price rises will become more visible to consumers.”

Full release here.

UK PMI manufacturing dropped to 53.1 in April, down from 55.1 and matched expectation of 53.1. Markit noted that new export business declines. Also, stock-building continues at solid, yet slower, pace.

Rob Dobson, Director at IHS Markit, which compiles the survey:

“The upturn in the UK manufacturing sector eased at the start of the second quarter. Growth of output and new orders slowed, leading to job cuts for the third time in the past four months. The trend in new export business was especially weak, as high stock holdings at clients and slower global economic growth led to reduced demand from key markets such as the European Union, the USA and China. There were also reports of overseas clients acting now to re-route their supply chains away from the UK in advance of Brexit.

“A central theme at UK manufacturers during recent months has been stockpiling activity in advance of Brexit, and this process continued into April. Rates of increase in both inventories of inputs and finished products remained historically rapid, despite cooling from the record highs seen in March. Companies noted that the delay to the scheduled Brexit date meant they had to ensure levels of key inputs remained sufficiently large to cover as broad a range of outcomes as possible in coming months.

“The stock build has clearly still helped support production growth, with a number of companies attributing increased output in April to Brexit-related stock-building.

“Manufacturers’ outlook remained relatively upbeat, however, with over 50% forecasting their output will be higher in 12 months’ time. Companies plan to use new product launches, new technologies and improved marketing strategies to drive growth forward in the coming months. However, Brexit uncertainty continues to weigh on plans, as some firms remain concerned about future growth prospects and the likely impact on output and demand from the unwinding of inventory positions later in the year.”

Full release here.