Home sales not exports fuel manufacturing revival

UK manufacturers turned in their best performance in over a year in May, according to the latest Markit/CIPS Purchasing Managers’ Index, which rose from 50.2 to 51.3 (above 50 demonstrates growth).

The survey showed that production and new orders had increased but with the domestic market rather exports driving orders. It also found that the manufacturing sector had created new jobs for the first time in four months.

“Although the domestic market was the main impetus to new order inflows, demand from overseas markets at least managed to keep its head above water," commented Markit economist Rob Dobson.

Some commentators regard the survey as signs of a long-awaited upturn.

“It's encouraging,” said Alan Clarke of Scotiabank.” And given that recently we've tended to see UK data as an early warning of what's happening in the eurozone, it suggests to me that this improving trend in business sentiment will continue.  It's hardly a booming level but it's improving nonetheless."