The UK manufacturing sector showed signs of improving in November although it remained firmly in contraction territory, according to figures from S&P Global.
The S&P Global/CIPS UK manufacturing PMI posted 47.2 in November, up from 44.8 in October, rising for the third successive month to its highest level since April.
It was ahead of City expectations for a reading of 46.7.
Although production contracted for the ninth consecutive month, the rate of decline eased sharply to its second-weakest during that sequence, the report showed.
However, November saw all five of the PMI components (new orders, output, employment, suppliers' delivery times and stocks of purchases) remain at levels consistent with a deterioration in operating conditions, albeit to lesser extents than in the prior survey month.
Job losses were registered for the fourteenth successive month, the report showed.
Rob Dobson, director at S&P Global Market Intelligence, said the latest PMI report “brings little festive cheer when the finer details are considered.”
“With new order inflows and exports continuing to fall sharply, and clients destocking, a sustained meaningful growth revival still looks elusive,” he said.
“Manufacturers are preparing for tough times ahead, with their continued caution leading to cutbacks in staffing, inventories and purchasing,” he added.
Martin Beck, chief economic advisor to the EY ITEM Club, pointed out manufacturers continue to face a significant obstacle to demand posed by a rise in interest rates and uncertainty stemming from geopolitical tensions isn’t helping.
Overall, he thinks manufacturing faces the same sluggish outlook likely to face the wider economy in the near term.
But 2024 should deliver an improvement, as interest rates fall and the full gains of lower cost pressures materialise, he added.