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British manufacturing sector feels weight of Brexit uncertainty

Xinhua | Updated: 2018-11-02 10:16
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Anti-Brexit protesters hold flags and placards opposite the Houses of Parliament in London, Britain, Oct 17, 2018. [Photo/Agencies]

LONDON - Britain's manufacturing sector looks to have suffered a significant slowdown in October because of uncertainty over Brexit, a survey released on Wednesday revealed.

The October manufacturing Purchasing Manager's Index (PMI) survey from IHS/Market came in below expectations with a fall of 2.5 points, one of the steepest falls seen in the index over the past five years.

The index fell to 51.1, where above 50 indicates growth, suggesting that activity in the sector slowed significantly last month.

This is the lowest level since the month following the Brexit referendum vote in June 2016.

The indicator for output recorded a 3.7 point fall to 51.6, a level that in the past typically would have been consistent with a fall in manufacturing production.

The new orders index dipped below the neutral level of 50, with the weakness apparently concentrated in foreign demand, reflected constricting global trade demands.

Markit reported that foreign demand decreased for the second time in the past three months, with some companies reporting that Brexit uncertainties had negatively impacted inflows of new work from within the EU.

Others focussed more attention on rising global trade tensions and weaker demand from the world autos sector, Markit reported.

Economist Francesco Arcangeli of the manufacturing firms' representative organization EEF said:"Companies are particularly concerned about rising trade tensions, a Brexit situation which still lacks clarity and the recent volatility in the commodity and foreign exchange market.

"This underlines once more how important stability is, and how a clear decision on Brexit is needed to bring back optimism to the sector."

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