Weaker sterling fails to lift UK supplier output

Manufacturing growth slowed last month despite the pound’s weakness, the Chartered Institute for Procurement & Supply said today.

The easing pace of new orders “suggests output growth may slow further”, survey compiler IHS Markit said. Its activity index, where a score over 50 signals growth, fell to 54.6 in February from 55.7.

Although export orders rose, the increase wasn’t big enough to make up for the shortfall in domestic business.

IHS Markit’s Rob Dobson said: “The big question remains as to whether robust growth can be sustained or whether it will continue to wane in the coming months.”

The pound is down some 18% since the referendum, making manufacturers more competitive. But firms still face spiralling costs as the weaker currency puts up the cost of imported raw materials.

It fell further today as the City raised its bets on a March interest rate rise from the US Federal Reserve, strengthening the dollar.

Figures from the Bank of England hinted at a looming consumer slowdown.

Shoppers were more reluctant to take out personal loans and credit card debt in January.