Latest data released by Markit - 1 July 2020
The preliminary release can be found here. No changes to the initial estimate as UK manufacturing sees some stabilisation in June amid a recovery in output and business optimism for the most part as factories restarted and clients reopened.
Looking at the details, new orders fell for a fourth straight month but at a slower pace but business sentiment is seen rising to a 21-month high with over 63% of manufacturers forecasting that output will rise over the coming year.
That said, new export business fell for an eight straight month and continues to underscore low market confidence and subdued demand conditions in general.
Markit notes that:
"June completed a marked turnaround in momentum in UK manufacturing, as the sector switched from April's record contraction back to stabilisation in the space of two months. Output edged higher and domestic demand firmed as lockdown restrictions loosened, factories restarted and staff returned to work. Business optimism also recovered to a 21-month high.
"The planned loosening in COVID-19 restrictions on the 4th July should aid further gains in coming months. Although the trend in new export business remains weak, that should also strengthen as global lockdowns and transport constraints ease further.
"The main focus is now shifting towards the labour market. Concerns are rising about the potential for marked job losses, especially once the phase out of government support schemes begins. The news on that footing is less positive, with June seeing a further reduction in staffing levels and, although easing sharply since April's record, the rate of job loss remains among the steepest in the 29-year survey history. Economic conditions will need to improve markedly across the UK, or some support retained, if the labour market downturn is to avoid becoming more entrenched through the remainder of the year."
