The slump in the U.K. manufacturing activity eased at more-than-expected in April on a renewed expansion in new orders, suggesting that growth would gather momentum in the second quarter after the economy averted a triple-dip recession at the beginning of the year.
The seasonally adjusted purchasing managers' index for the manufacturing sector rose to 49.8 in April from March's revised reading of 48.6, a survey by Markit Economics and the Chartered Institute of Purchasing and Logistics (CIPS) showed Wednesday.
Economists had forecast the index to rise to 48.5 from the previous month's originally reported reading of 48.3. A figure below 50 suggests contraction in the sector, while one above the mark indicates growth.
"April's CIPS manufacturing survey offers a glimmer of hope that the sector's recession might be coming to an end. But stagnation, rather than outright expansion, may be the best that manufacturers can hope for this year," Capital Economics U.K. Economist Samuel Tombs said.
New orders received by goods producers increased modestly in April, reversing the decreases seen in the previous two months. Meanwhile, manufacturers lowered their workforces for the third straight month in April, but at a weaker pace than in the prior two months.
In line with the gain in new business, production at U.K. factories increased moderately, after recording declines in both March and February. The recovery in production volumes also reflected firms' efforts to clear backlogs.
Average input prices decreased slightly in April, after rising for seven successive months, amid declines in commodity and fuel prices. Meanwhile, factory gate prices rose further as firms tried to protect operating margins, taking the current sequence of increase to three-and-a-half years.
"Following the poor start to the year, when manufacturing acted as a drag on the economy in the opening quarter, it is welcome to see the sector showing signs of stabilising in April," Markit Senior Economist Rob Dobson said.
"With forward-looking indicators such as new orders and the demand-to-inventory ratio also ticking higher, the sector should at least be less of a drag on broader GDP growth in the second quarter."
Meanwhile, a survey by the Confederation of British Industry showed last week that factory orders weakened to the lowest level in two-and-half years in April, reinforcing the view that the sector continues to face tough domestic and international conditions.
However, respondents to the CBI survey said they expect orders to grow at the strongest pace for the year. They also expect increases in output and employment in the coming months.
The U.K. economy expanded at a faster-than-expected rate of 0.3 percent in the first quarter and averted a triple-dip recession, largely underpinned by an expansion in the dominant service sector even in the face of austerity program.
The economy lost its coveted 'AAA' rating for the first time since 1978 when Moody's Investors Service downgraded its ratings to 'Aa1' in February. This was followed by another downgrade by Fitch Ratings this month to 'AA+'.
For comments and feedback contact: editorial@rttnews.com
Economic News
What parts of the world are seeing the best (and worst) economic performances lately? Click here to check out our Econ Scorecard and find out! See up-to-the-moment rankings for the best and worst performers in GDP, unemployment rate, inflation and much more.
April 24, 2026 15:15 ET Economics news flow was relatively light this week even as the conflict in the Middle East continued, raising concerns for policymakers. In the U.S., spending data, initial jobless claims and pending home sales were the highlights. Business confidence in the biggest euro area economy was in focus in Europe. Inflation data from Japan gained attention in Asia.