The Chartered Insititute of Purchasing and Supply released its latest PMI (Purchasing Manager's Index) in conjunction with Markit economics on manufacturing today which has slowed from 57.6 to 57.3.
The figure shows that the sector is slowing, after a survey of executives from Britain's top companies looking at how their business is performing at a micro-economic level.
"The PMI is showing surprising resilience, having fallen only modestly since hitting a fifteen-and-a-half year peak in May, and July even saw new order growth accelerate again, largely on the back of rising domestic demand," said Rob Dobson, senior economist at Markit.
RISE AND FALL
The data however masks a 'fall' in manufacturing that is to come say Capital Economics who note the graph tends to show that PMI is to fall in months to come:
Having peaked already, PMI is set to fall as a 'nascent recovery' in exports continues to show weakness in the eurozone and strong domestic demand gets overrun by weak fiscal strength of the economy affected by spending cuts to come.
The boom/bust line is 50.
"The purchasing managers' survey points to slightly slower but still healthy manufacturing expansion in July, thereby boosting hopes that the UK economy can achieve decent growth in the third quarter even if it is highly unlikely to sustain the 1.1% growth rate achieved in the second quarter." said IHS Global's Howard Archer.
"This heightens concern that UK manufacturing exports could be hit significantly by slowing global growth and problems in the Eurozone. Furthermore, while the pound remains at generally competitive levels, it has firmed to be at a five-month high against the dollar and is also up against the euro." Archer added.
Meanwhile, China's Purchasing Manager's Index fell into minus today (49.4) says HSBC, as the world's biggest expanding economy backed up as output and exports reduced.