It was another day for records no one wanted to see broken. The latest report from the Chartered Institute of Purchasing and Supply was out yesterday, and the index for measuring prices paid by manufacturers rose to its highest level since 1999, while the index for measuring prices charged hit its highest level since 1995.
Apparently, the latest score for output inflation – 60.6, is compatible with 3.5 per cent CPI inflation down the line.
The main index – the Purchasing Managers Index, stayed flat, at 51.3. At least that’s above the 50 no-change mark.
The real hope for the manufacturing sector rests with exports. But the runes are not promising. In March, the CIPS index for measuring new export orders touched 50. That was slightly up on February, but far too low.
But if the pound continues to fall, one assumes exports will continue to lift.
But a falling pound will bring with it inflationary dangers. Couple those pressures with the fact that manufacturers are upping prices at the fastest rate in over ten years, and it is easy to understand the dilemma facing the Bank of England’s Monetary Policy Committee, which is due to meet next week to decide upon interest rates for the following month.
Comments
Trackbacks