Post-Brexit manufacturing PMI pushes Pound above $1.29
Resilience has always been one of the strongest traits of the UK’s economy; it is a trait that we see again and again, especially now that the economy is dealing with the impact of Brexit. After seeing a steep decline after the decision to exit the EU was announced, the pound has been seen trading above the $1.29 mark again.
The reason behind this sudden pop is the release of the UK’s manufacturing index or PMI. There are some great signs to be discovered from this hike, particularly in the manufacturing sector and the future of the economy as a whole.
A 3-Year High
The rise of the UK’s Purchasing Managers’ Index, PMI, signals a number of great things. For starters, the new PMI of 57.3 hits a 3-year high, climbing from the 54.2 PMI recorded in March. The British manufacturing industry is responding to Brexit beautifully, boosting production capacity while taking advantage of the lower pound.
The latter is also the reason why UK brands and manufacturers can increase their export to other European countries. The lower pound means goods produced in the UK can be priced competitively and be more appealing on the market.
It is also important to note that the sudden increase in production and manufacturing is not a one-time occurrence. Experts believe that the manufacturing industry as well as the market are showing strong resilience commonly seen throughout history. Brexit may have had a number of negative impacts, but it has clearly ignited the spirit of local businesses, allowing them to remain competitive.
More Than Numbers
The increase in the PMI index is more than just a hike in numbers. Take a look at local manufacturing companies and you will see a lot of activities and steady growth as well. The British automotive industry, for example, is increasing its production capacity to meet the demands for parts from companies like BMW and Mercedes.
The food industry is no different. A number of food processing companies are investing in food conveyor packing systems from companies like CKF to further boost their production capacities and processing speeds. Steps are being taken to increase efficiency in different parts of these operations while new technologies are implemented to help improve the products coming out of the production lines.
Similar changes are being made in other industries as well. In fact, we haven’t seen this level of collective growth for a while.
The Future of the UK
The manufacturing industry can be the foundation of a stronger, better UK in the future. Britain used to be known as the workshop of the world; it is a reputation that may well be reignited now that manufacturing companies are taking active steps to be more competitive.
It will also be interesting to see the PMI index for next month. It’s always more difficult to maintain momentum, but judging from market conditions and the confidence of analysts in different industries related to manufacturing, this level of growth can be sustained for a longer period of time. Be sure to stay tuned right here on The Exeter Daily for more updates from the market.
