This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.theguardian.com/business/live/2018/sep/03/china-manufacturing-growth-falls-uk-factory-pmi-business-live

The article has changed 14 times. There is an RSS feed of changes available.

Version 12 Version 13
Pound falls as UK factory growth stumbles and Brexit uncertainty grows - business live Pound falls as UK factory growth stumbles and Brexit uncertainty grows - business live
(3 months later)
And finally... Britain’s FTSE 100 closed the day almost 1% higher at 7,504, a gain of 72 points.And finally... Britain’s FTSE 100 closed the day almost 1% higher at 7,504, a gain of 72 points.
The weaker pound can take the ‘credit’ -- sterling is still languishing almost a cent lower today at $1.2878.The weaker pound can take the ‘credit’ -- sterling is still languishing almost a cent lower today at $1.2878.
It’s down a similar amount against the euro too, following today’s weak factory growth report.It’s down a similar amount against the euro too, following today’s weak factory growth report.
The pound-euro exchange rate over the last 3 months...#Brexit #Britain pic.twitter.com/sk53m01wcGThe pound-euro exchange rate over the last 3 months...#Brexit #Britain pic.twitter.com/sk53m01wcG
The City continues to feel Brexit jitteriness, as the government rebutted Boris Johnson’s latest attack on the Chequers plan.The City continues to feel Brexit jitteriness, as the government rebutted Boris Johnson’s latest attack on the Chequers plan.
Downing Street insisted that Britain needed “serious leadership with a serious plan” -- a coded way of saying it didn’t need the former foreign secretary’s particular talents.Downing Street insisted that Britain needed “serious leadership with a serious plan” -- a coded way of saying it didn’t need the former foreign secretary’s particular talents.
No 10 slaps down Boris Johnson over Chequers plan criticism
Here’s David Madden of CMC Markets on sterling’s bad day:Here’s David Madden of CMC Markets on sterling’s bad day:
GBP/USD had a big sell-off today after the UK posted disappointing manufacturing figures. The manufacturing PMI report fell to 52.8 in August – a two year low.GBP/USD had a big sell-off today after the UK posted disappointing manufacturing figures. The manufacturing PMI report fell to 52.8 in August – a two year low.
The update comes as there is still uncertainty surrounding Brexit. Michel Barnier, the EU negotiator, said he is ‘strongly’ opposed to Prime Minister May’s trading proposals.The update comes as there is still uncertainty surrounding Brexit. Michel Barnier, the EU negotiator, said he is ‘strongly’ opposed to Prime Minister May’s trading proposals.
Meanwhile Mrs May, will not comprise on the plans she mapped out at Chequers. Once again, the water has been muddied regarding the discussions, and while there is no easy end in sight, pressure is likely to remain on the pound.Meanwhile Mrs May, will not comprise on the plans she mapped out at Chequers. Once again, the water has been muddied regarding the discussions, and while there is no easy end in sight, pressure is likely to remain on the pound.
And on that note, goodnight! GWAnd on that note, goodnight! GW
The US financial markets are quiet today, as traders celebrate Labor Day. So here’s a quick recap.The US financial markets are quiet today, as traders celebrate Labor Day. So here’s a quick recap.
Manufacturers in Asia and Europe have suffered a drop in growth, as anxiety over the US-China trade war grows.Manufacturers in Asia and Europe have suffered a drop in growth, as anxiety over the US-China trade war grows.
Chinese factories posted their weakest expansion in 14 months in August, due to the fifth drop in exports in a row. Economists fear that the tariffs imposed on Washington are hurting the Chinese economy, and forcing firms to cut jobs.Chinese factories posted their weakest expansion in 14 months in August, due to the fifth drop in exports in a row. Economists fear that the tariffs imposed on Washington are hurting the Chinese economy, and forcing firms to cut jobs.
British manufacturers also had a lacklustre August, with growth dropping to a 25-month low. Some purchasing managers cited Brexit uncertainty, with no decision on the UK’s future relationship with the EU.British manufacturers also had a lacklustre August, with growth dropping to a 25-month low. Some purchasing managers cited Brexit uncertainty, with no decision on the UK’s future relationship with the EU.
Eurozone factories also slowed last month, led by Spain and Italy.Eurozone factories also slowed last month, led by Spain and Italy.
With Brexit pressures building in Westminster, and in Brussels, the pound slid by almost a cent against the US dollar - back below $1.29.With Brexit pressures building in Westminster, and in Brussels, the pound slid by almost a cent against the US dollar - back below $1.29.
Bank of England governor Mark Carney is coming under more pressure to say whether he might extend his term beyond June 2019. MPs will want answers when the BoE testify to the Treasury committee tomorrow afternoon.Bank of England governor Mark Carney is coming under more pressure to say whether he might extend his term beyond June 2019. MPs will want answers when the BoE testify to the Treasury committee tomorrow afternoon.
Brazil has bucked the trend of generally disappointing data today, with manufacturing growth hitting a four-month high.Brazil has bucked the trend of generally disappointing data today, with manufacturing growth hitting a four-month high.
However, the recent slump in the value of the real (amid a political corruption scandal) is pushing up import costs.However, the recent slump in the value of the real (amid a political corruption scandal) is pushing up import costs.
#Brazil Manufacturing #PMI at four-month high of 51.1 in August as new business gains boost production. Input cost inflation hits ten-year peak amid currency weakness https://t.co/29viI5rDsy pic.twitter.com/mGpyK4pFny#Brazil Manufacturing #PMI at four-month high of 51.1 in August as new business gains boost production. Input cost inflation hits ten-year peak amid currency weakness https://t.co/29viI5rDsy pic.twitter.com/mGpyK4pFny
...and here’s the latest on TSB’s IT problems....and here’s the latest on TSB’s IT problems.
TSB apologises for another disruption to online services
Here’s our news story about Mark Carney’s future:Here’s our news story about Mark Carney’s future:
Mark Carney to face MPs' questions over future at Bank of England
The drop in the pound has given shares in London a boost.The drop in the pound has given shares in London a boost.
The FTSE 100 has gained around 1% today, currently up 68 points at 7501. This lifts the blue-chip index from the four-month low struck on Friday afternoon.The FTSE 100 has gained around 1% today, currently up 68 points at 7501. This lifts the blue-chip index from the four-month low struck on Friday afternoon.
A weak sterling pushes up the value of overseas earnings for the multinationals that make up much of the Footsie.A weak sterling pushes up the value of overseas earnings for the multinationals that make up much of the Footsie.
The pound is also sliding against the euro, down almost one eurocent at €1.108.The pound is also sliding against the euro, down almost one eurocent at €1.108.
That means one euro is worth 90.27p, close to last month’s one-year high.That means one euro is worth 90.27p, close to last month’s one-year high.
Rupert Harrison of asset manager BlackRock suggests investors should brace for more Brexit twists and turns:Rupert Harrison of asset manager BlackRock suggests investors should brace for more Brexit twists and turns:
Brexit battle is rejoined in earnest today - domestic action hotting up just as signs emerge of progress in negotiations. Key interaction between the two: the more it looks like Tories might back temporary EEA the less likely EU are to compromise in direction of Chequers...Brexit battle is rejoined in earnest today - domestic action hotting up just as signs emerge of progress in negotiations. Key interaction between the two: the more it looks like Tories might back temporary EEA the less likely EU are to compromise in direction of Chequers...
The pound is continuing to slide on the currency markets, and is now down almost one cent at $1.2875 against the US dollar.The pound is continuing to slide on the currency markets, and is now down almost one cent at $1.2875 against the US dollar.
This morning’s weak factory data hasn’t helped, but the key driver appears to be Brexit worries.This morning’s weak factory data hasn’t helped, but the key driver appears to be Brexit worries.
Today’s losses wipe out last Wednesday’s rally, sparked by EU negotiator Michel Barnier promising to offer Britain an “unprecedented deal”.Today’s losses wipe out last Wednesday’s rally, sparked by EU negotiator Michel Barnier promising to offer Britain an “unprecedented deal”.
Barnier sounded less optimistic over the weekend, saying he “strongly opposed” the UK’s proposal of a free trade area for goods underpinned by a common rulebook.Barnier sounded less optimistic over the weekend, saying he “strongly opposed” the UK’s proposal of a free trade area for goods underpinned by a common rulebook.
With leave-supporting Conservative MPs also denouncing Theresa May’s ‘Chequers agreement’ from the other side, the City is getting edgier.With leave-supporting Conservative MPs also denouncing Theresa May’s ‘Chequers agreement’ from the other side, the City is getting edgier.
David Lowe, head of international trade at law firm Gowling WLG, explains why:David Lowe, head of international trade at law firm Gowling WLG, explains why:
“The fluctuating value of the pound is frequently attributed to an individual aspect of the UK’s political and economic infrastructure – which steps away from the reality that it is always a basket of issues and trends.“The fluctuating value of the pound is frequently attributed to an individual aspect of the UK’s political and economic infrastructure – which steps away from the reality that it is always a basket of issues and trends.
The drop in the pound this morning might be as a result of the issue of the statistics for UK manufacturing, but they will also be factoring in announcements over the weekend from May, Barnier and Johnson, and the growing concern over recent months about the risk of a hard or crash Brexit.The drop in the pound this morning might be as a result of the issue of the statistics for UK manufacturing, but they will also be factoring in announcements over the weekend from May, Barnier and Johnson, and the growing concern over recent months about the risk of a hard or crash Brexit.
The markets are betting the outcome of Brexit negotiations will be that the UK will be poorer as a result.”The markets are betting the outcome of Brexit negotiations will be that the UK will be poorer as a result.”
Long-suffering customers at TSB have a special dose of back-to-school blues today.Long-suffering customers at TSB have a special dose of back-to-school blues today.
The UK bank carried out some “planned maintenance” in the early hours of Saturday morning. And unfortunately (but alas not surprisingly) some customers then found they couldn’t access internet banking or get their mobile app to work.The UK bank carried out some “planned maintenance” in the early hours of Saturday morning. And unfortunately (but alas not surprisingly) some customers then found they couldn’t access internet banking or get their mobile app to work.
TSB tweeted early this morning that the problem was fixed, only to later admit that it wasn’t.TSB tweeted early this morning that the problem was fixed, only to later admit that it wasn’t.
The intermittent issues with Internet Banking and the mobile app that some TSB customers experienced yesterday have been resolved. Please accept our apologies for any inconvenience this may have caused.The intermittent issues with Internet Banking and the mobile app that some TSB customers experienced yesterday have been resolved. Please accept our apologies for any inconvenience this may have caused.
We’re aware that some customers are having issues this morning using Internet Banking, the mobile app and telephone self service. We are currently working to fix this issue. Please accept our apologies for any inconvenience caused.We’re aware that some customers are having issues this morning using Internet Banking, the mobile app and telephone self service. We are currently working to fix this issue. Please accept our apologies for any inconvenience caused.
This must be gutting for customers who endured TSB’s IT meltdown in April, when services were disrupted for weeks.This must be gutting for customers who endured TSB’s IT meltdown in April, when services were disrupted for weeks.
A few days ago, TSB fell to the bottom of MoneySavingExpert’s customer service league table -- today’s disruption won’t help it recover...A few days ago, TSB fell to the bottom of MoneySavingExpert’s customer service league table -- today’s disruption won’t help it recover...
Speculation has been swirling this morning that Mark Carney could agree to stay on longer as Bank of England governor.Speculation has been swirling this morning that Mark Carney could agree to stay on longer as Bank of England governor.
This particular ‘news hare’ has been scampering since last week, when the Evening Standard reported that Carney has been asked to hang on until 2020.This particular ‘news hare’ has been scampering since last week, when the Evening Standard reported that Carney has been asked to hang on until 2020.
He’s currently due to depart in June 2019, meaning the government needs to pick a successor soon. But the BBC are now reporting that the Treasury and the BBC are discussing “delaying” Carney’s departure, as it’s hard to appoint a successor in the current Brexit uncertainty.He’s currently due to depart in June 2019, meaning the government needs to pick a successor soon. But the BBC are now reporting that the Treasury and the BBC are discussing “delaying” Carney’s departure, as it’s hard to appoint a successor in the current Brexit uncertainty.
Over in Westminster, Theresa May’s spokesperson has been asked about the situation at the regular lobby briefing. He replied that:Over in Westminster, Theresa May’s spokesperson has been asked about the situation at the regular lobby briefing. He replied that:
The governor has said that he intends to step down in 2019. That is still the plan.The governor has said that he intends to step down in 2019. That is still the plan.
Reading between the lines, that doesn’t rule out an extension -- could the governor perhaps extend his innings by a few more months?Reading between the lines, that doesn’t rule out an extension -- could the governor perhaps extend his innings by a few more months?
The City would probably welcome such a move - it would eliminate one (small) element of Brexit uncertainty. Leave supporters wouldn’t be pleased, though, given Carney’s many warnings about the impact of leaving the EU.The City would probably welcome such a move - it would eliminate one (small) element of Brexit uncertainty. Leave supporters wouldn’t be pleased, though, given Carney’s many warnings about the impact of leaving the EU.
Carney is testifying to parliament’s Treasury committee on Tuesday, so he’s bound to be quizzed about the situation. Popcorn at the ready!Carney is testifying to parliament’s Treasury committee on Tuesday, so he’s bound to be quizzed about the situation. Popcorn at the ready!
Mark Carney may be in talks about staying BOE governor beyond his planned departure date of June https://t.co/iuZgLTFpFA via @lucy_meakin #tictocnews pic.twitter.com/9sjqukwJtVMark Carney may be in talks about staying BOE governor beyond his planned departure date of June https://t.co/iuZgLTFpFA via @lucy_meakin #tictocnews pic.twitter.com/9sjqukwJtV
CarneyCarney
The slide in UK factory growth has brought the City back to earth with a bump after the summer holidays.The slide in UK factory growth has brought the City back to earth with a bump after the summer holidays.
Stephen Cooper, UK head of industrial manufacturing at KPMG, says the PMI report has “a bit of back to school dread” about it.Stephen Cooper, UK head of industrial manufacturing at KPMG, says the PMI report has “a bit of back to school dread” about it.
Optimism has fallen whilst job creation is virtually at a standstill, with cuts by larger businesses neutralised by job growth in SMEs.Optimism has fallen whilst job creation is virtually at a standstill, with cuts by larger businesses neutralised by job growth in SMEs.
“Together with export orders – also at a 25 month low despite continued sterling weakness – these figures are particularly concerning against the backdrop of global trade wars and increasing uncertainty around Brexit – both of which will be weighing on businesses.”“Together with export orders – also at a 25 month low despite continued sterling weakness – these figures are particularly concerning against the backdrop of global trade wars and increasing uncertainty around Brexit – both of which will be weighing on businesses.”
UK manufacturing will keep struggling until a Brexit transition deal has been hammered out, warns Helena Sans, Head of Manufacturing at Barclays.UK manufacturing will keep struggling until a Brexit transition deal has been hammered out, warns Helena Sans, Head of Manufacturing at Barclays.
Here’s her take on today’s factory PMI:Here’s her take on today’s factory PMI:
“With such an underwhelming set of data, the only positive to pull out is that the index still remains in positive territory.“With such an underwhelming set of data, the only positive to pull out is that the index still remains in positive territory.
The improving performance we‘ve seen in exports over the past two years, boosted by the weakness in sterling, took a worrying hit last month.The improving performance we‘ve seen in exports over the past two years, boosted by the weakness in sterling, took a worrying hit last month.
Political and economic uncertainty is clearly impacting manufacturers investment intentions but one thing that is certain is in order to increase exports and drive growth, what manufacturers need to see sooner rather than later is a Brexit transition deal to avoid the risk of prolonging a more cautious and tentative approach to investment from the sector.”Political and economic uncertainty is clearly impacting manufacturers investment intentions but one thing that is certain is in order to increase exports and drive growth, what manufacturers need to see sooner rather than later is a Brexit transition deal to avoid the risk of prolonging a more cautious and tentative approach to investment from the sector.”
UK #manufacturing upturn slows as new export orders contract for first time since April 2016 #procurement #supplychain https://t.co/KoD1dKsBGt pic.twitter.com/p2q7yPGS63UK #manufacturing upturn slows as new export orders contract for first time since April 2016 #procurement #supplychain https://t.co/KoD1dKsBGt pic.twitter.com/p2q7yPGS63
Lee McDarby, Corporate IP Managing Director at foreign exchange firm moneycorp, says confusion over Britain’s future relationship with the EU is hurting factories - and hampering new investment.Lee McDarby, Corporate IP Managing Director at foreign exchange firm moneycorp, says confusion over Britain’s future relationship with the EU is hurting factories - and hampering new investment.
He says:He says:
“The news that manufacturing is at a two year low and well below forecast will come as a shock to markets after months of steady, if unspectacular, growth.“The news that manufacturing is at a two year low and well below forecast will come as a shock to markets after months of steady, if unspectacular, growth.
Ordinarily the weak Pound should lead to increasing demand for British manufactured products abroad, however this has not materialised.Ordinarily the weak Pound should lead to increasing demand for British manufactured products abroad, however this has not materialised.
Instead, manufacturers are being held back by the same lack of confidence in the economy that is suppressing Sterling. It’s tough to nail new orders from overseas when you have no certainty over what trading rules will look like in six months’ time.Instead, manufacturers are being held back by the same lack of confidence in the economy that is suppressing Sterling. It’s tough to nail new orders from overseas when you have no certainty over what trading rules will look like in six months’ time.
UK factories are grappling with “suppressed domestic demand and a slowdown in output”, explains Dave Atkinson, UK head of manufacturing at Lloyds Bank Commercial Banking.UK factories are grappling with “suppressed domestic demand and a slowdown in output”, explains Dave Atkinson, UK head of manufacturing at Lloyds Bank Commercial Banking.
He adds:He adds:
“As we approach the final months of negotiations on Britain’s exit from the EU, firms are continuing to plan for all outcomes. Investment in automation and robotics are key for many who are looking to tackle productivity and mitigate labour shortages.“As we approach the final months of negotiations on Britain’s exit from the EU, firms are continuing to plan for all outcomes. Investment in automation and robotics are key for many who are looking to tackle productivity and mitigate labour shortages.
“However, there remains some anxiety among manufacturers with exposure to consumer markets. Sluggish wage growth has blunted spending power and the current woe in the retail sector is weakening demand for new stock.”“However, there remains some anxiety among manufacturers with exposure to consumer markets. Sluggish wage growth has blunted spending power and the current woe in the retail sector is weakening demand for new stock.”
The pound had already been under pressure this morning, due to Brexit worries.The pound had already been under pressure this morning, due to Brexit worries.
The slowdown in UK manufacturing has now dragged it back below $1.29, down 0.5% today.The slowdown in UK manufacturing has now dragged it back below $1.29, down 0.5% today.
Duncan Brock, Group Director at the Chartered Institute of Procurement & Supply, is also alarmed by the slowdown across UK factories.Duncan Brock, Group Director at the Chartered Institute of Procurement & Supply, is also alarmed by the slowdown across UK factories.
“Fears for a stalling manufacturing sector took a step closer to becoming a reality this month with the most disappointing performance for two years. “The lifeline of strong export orders enjoyed since May 2016 dried up, as the attraction of a weaker pound was not enough to sustain the momentum.....“Fears for a stalling manufacturing sector took a step closer to becoming a reality this month with the most disappointing performance for two years. “The lifeline of strong export orders enjoyed since May 2016 dried up, as the attraction of a weaker pound was not enough to sustain the momentum.....
With a subdued global economy threatened by escalating trade wars and Brexit uncertainty making its mark, it’s unclear where future opportunities to sustain the health of the sector will come from.With a subdued global economy threatened by escalating trade wars and Brexit uncertainty making its mark, it’s unclear where future opportunities to sustain the health of the sector will come from.