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UK manufacturing output expanded for the first time in a year in October, survey results from S&P Global showed on Monday, despite ongoing weakness in both domestic and overseas markets. The manufacturing purchasing managers’ index rose to 49.7 points in October from 46.2 in September, remaining slightly below the 50-point neutral mark. It marginally outperformed the flash reading of 49.6 points. Three of the PMI constituents - new orders, employment and stocks of purchases - registered contractions, while the sub-indices for output and suppliers’ delivery times showed improved operating conditions. Production volume rose in the consumer and intermediate goods industries. Growth was stronger in intermediate goods, partly due to a boost to some manufacturers from the stage restarting of production at Jaguar Land Rover. Demand from both domestic and overseas markets fell during October, as total new business contracted for the thirteenth month in a row, though to a weaker extent than in the previous month. Business optimism climbed to an eight-month high, but remained below the long-run average. S&P Global said positive sentiment was linked to economic recovery, efforts to regain market share, promotional activity and new product launches. Employment contracted for the twelfth consecutive month due to the impact of subdued demand and earlier labour cost increases. S&P Global said there were signs that purchase price inflation pressure is easing, as average input costs rose at the slowest pace so far in 2025. ‘The October PMI survey shows UK manufacturing production rising for the first time in a year, which is a positive in itself. However, there are real concerns that the bounce could prove short-lived,’ said Rob Dobson, director at S&P Global Market Intelligence. ‘Not only did October see auto sector supply chains benefit from the production restart at JLR, which will provide only a temporary spike in production, but sluggish demand from both domestic and overseas markets meant October’s output growth was dependent on firms eating into backlogs of orders placed in prior months and allowing unsold stock to accumulate.’ Dobson said there are concerns the forthcoming UK government budget will ‘exacerbate the lingering challenges’ created by last year’s budget, especially related to the minimum wage and employer national insurance contributions. ‘This means that business optimism remains below its long-run average despite rising to an eight-month high in October. Manufacturers seem to be stuck in a holding pattern until the domestic policy and geopolitical backdrops exhibit greater clarity.’ The PMI survey features a panel of 650 manufacturers in the UK. The responses were collected between October 9 and 28. The service and composite PMI readings will be released on Wednesday, with the construction PMI reading to follow on Thursday. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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