British manufacturing activity expansion slowed in March, but overall growth in output and new orders are robust, a survey showed today.
The Chartered Institute of Purchasing and Supply/Royal Bank of Scotland Purchasing Managers' Index fell to 54.4 last month from 55.4 in February. Analysts had predicted a less steep drop to 55.1.
Policymakers worried about a pick-up in pricing power may take some very small comfort from news that output prices did not rise quite as fast as they did in February, with the index measuring this dipping to 55.5 from a record 56.9.
But input costs were up at an even sharper pace and that even before the latest run-up in oil prices. The input costs index rose to 62.3, its highest since November, from 61.2.
New orders kept rising fast but not at the two-and-a-half-year high rate of the month before. The index fell to 57.1 from 57.6. The output index dipped to 54.5 from 56.8.
Export orders rose at their fastest pace since January 2004. The index edged up to 55.8 from 55.7, as British manufacturers continue to benefit from the upturn in global demand, particularly in the euro zone, Britain's biggest export market.