The pace of expansion in British manufacturing held at a four-year high in January while order books surged to a new four-year peak to solidify an already robust recovery.
The latest CIPS/Reuters purchasing managers' index released today was unchanged from December at 56.0 in January, although the unchanged number broke a 10-month run of gains in the index and was slightly below forecasts for 56.1.
Although manufacturers were still struggling to pass on higher costs in the form of higher prices charged to customers, the pound's relative stability against the euro though it rose against the dollar kept new export orders rolling in.
The data are sure to be welcomed by policymakers who have been hoping to see a consumer-driven economy become more balanced, with businesses now clearly starting to play catch-up.
Nearly every analyst in a recent Reuters poll predicted the Bank of England will raise its short-term interest rate this Thursday to 4.0 per cent from 3.75 per cent.
Those predictions followed recent news that retail sales surged over the Christmas period and the economy grew well above trend last quarter. The robust manufacturing data will only solidify those expectations.
Markets did not react, however, to the data, which followed a report that showed Eurozone manufacturing grew at a steady but less robust pace. The euro zone PMI edged up to 52.5 from 52.4, but below market expectations for a rise to 52.9.