London, England, United Kingdom (4E) – Manufacturing activity in the UK surprisingly expanded to its fastest pace in seven months, adding to signs of a broad-based recovery, driven by a rise in demand.
The monthly manufacturing purchasing managers index (PMI) of data firm Markit and the Chartered Institute of Purchasing and Supply jumped to 57.5 in June. The reading surpassed economists’ forecasts that the index will stay flat from May’s 57.0 level.
A reading above 50 indicates expansion in the industry, while a reading below 50 indicates contraction.
Tuesday’s survey results comes after a report from the Confederation of British Industry that showed demand at factories climbed last month and order books were the highest since last December.
Business investment is also bouncing back, and the UK economy’s recovery has prompted speculation that the Bank of England will soon raise its benchmark interest rate from the current record low.
A rise in new orders and an over three-year high jobs growth boosted the index in June, according to Markit.
A separate report from Markit released Tuesday showed that the performance of the British economy contrasts with the euro zone, where growth in the manufacturing sector in June slowed more than initially anticipated amid the struggles of the French economy.