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UK Manufacturing Activity Weakest in Eight Months

3 Apr 2017 8:54 am
 

By Jason Douglas
 

LONDON--British manufacturing activity expanded in March at the weakest pace in eight months, the latest sign the economy lost some momentum in the first quarter after growing healthily in the final three months of 2016.

Financial information firm IHS Markit Ltd. said its purchasing managers' index for the manufacturing sector registered 54.2 in March, down from 54.5 in February.

A reading above 50 indicates activity in the sector is expanding. March's reading was the weakest since early 2016, though it remained comfortably above the index's long-term average, Markit said.

The figures come after official data showed output in the U.K. services sector shrank in January, as rising inflation squeezed consumer spending. Economists expect first-quarter growth will be weaker than the 0.7% quarterly rate recorded in the final three months of 2016.

Markit said manufacturing activity was buoyed by healthy orders and said firms continued to hire new staff. But it added that many companies reported that a weakened pound was driving up the cost of raw materials.
 

Write to Jason Douglas at jason.douglas@wsj.com
 

(END) Dow Jones Newswires

April 03, 2017 04:54 ET (08:54 GMT)

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