British manufacturing lost more momentum in June than first estimated as new orders contracted at the fastest rate in two years, according to a survey that adds to signs of a stalling economy.
The S&P Global UK manufacturing purchasing managers’ index fell (PMI) to 52.8 from 54.6 in May, downwardly revised from a preliminary “flash” reading for June of 53.4.
The survey showed factory output barely grew and manufacturers were their gloomiest about the outlook since May 2020.
Price pressures, while still elevated, eased further from recent all-time highs.
Overall the PMI underlined the risk of a sharp slowdown or a recession in Britain, with manufacturers in other major European countries similarly struggling as inflation surges towards double-digit levels.
“Firms raised concerns about flat domestic demand, weaker export markets, inflationary pressure, the effect of the increased cost of living on consumer demand and supply chain issues,” survey compiler S&P Global said.
Bank of England Governor Andrew Bailey said on Wednesday that the central bank might not need to act “forcefully” to get inflation under control, adding there were signs of an economic slowdown taking hold in Britain.
Manufacturing output in April remained 2% below its pre-pandemic level, according to the latest official data.