PMI and OECD data commentary

“Today’s early reading of the Purchasing Managers’ Indexes shows that continued uncertainty is adding to the challenges and complexities faced by the UK manufacturing and services sectors.

“The decline in both services and manufacturing has hastened in November and the composite PMI (which combines both sectors) shows that private sector output has fallen by the sharpest pace since July 2016 (in the immediate aftermath of the Brexit referendum). Today’s PMI release is in line with Dun & Bradstreet’s latest industry data, which finds that corporate liquidations in consumer manufacturing rose by 17% in Q3 2019. Our data also shows that payment performance in manufacturing continues to lag behind the national average (31% vs 44%).

“However, the number of corporate liquidations in machinery manufacturing dropped by 11% for the quarter, reflecting the complex economic and political trading conditions that all UK industries are facing.

“In light of the subdued figures, many businesses will be adopting a ‘wait and see’ approach ahead of next month’s election. However, given the OECD today identified global growth as being the slowest since the financial crisis, UK growth is likely to remain muted in 2020, even if the elections bring a solution to the Brexit deadlock.”

Markus Kuger, Chief Economist at Dun & Bradstreet on PMI and OECD data: