Pound Gets a Boost from Strong Factory Growth
According to CIPS/Markit purchasing manager’s index survey, strong domestic demand advanced new business sales last month. Export orders also edged higher.
The CIPS figure was better than expected at 57.5, a half point rise, reflecting one of the sectors best spells of output and new order growth in the surveys 22 year history.
Scotiabank economist Alan Clarke said, “This is a very good performance, particularly when you consider that the pound is ten per cent stronger and expectations for the first rate hike have been brought forward somewhat in recent months.”
The update saw sterling climb to $1.7154, its highest level since 2008. Job vacancies also elevated for the 14th successive month with rising numbers, led by small and medium sized businesses, seen across all sectors
Rob Dobson senior economist at Market said, “With levels of production surging higher, and order books swollen by a further upswing in demand from both domestic and overseas clients, job creation accelerated to its highest for over three years.”
Samuel Tombs of Capital Economics has stated that, “As long as the pound does not appreciate much further, the outlook looks positive for manufacturers.”