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Manufacturers' prices jump, PMI unchanged

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Date: Tuesday 01 Apr 2008

LONDON (ShareCast) - The latest report on UK manufacturing has shown the purchasing managers index held steady last month, although prices soared and output growth dropped sharply.

The Chartered Institute for Purchasing and Supply’s (CIPS) PMI remained unchanged at 51.3 in March, topping analysts’ forecasts for a slip to 51. A read of over 50 indicates expansion.

But output growth fell to 52.3, down from February’s read of 53.2 and the lowest figure since December 2006.

Inflationary pressures also increased, with the input prices index surging from 72.7 to 76.3 in March, its highest in almost 13 years, while manufacturers’ output prices rose to a series record 60.6 from 59.9.

Experts reckon the Bank of England will be scratching its head as next week’s interest rate decision looms. The anticipated cut is by no means a foregone conclusion they say.