The seasonally adjusted Markit/CIPS Purchasing Manager's Index (PMI ) climbed to an eight month high of 54.4 in March, 54.0 in February. The PMI has now remained above the neutral 50.0 mark for 24 consecutive months. Moreover, the average reading for the opening quarter as a whole (53.8) was the best growth outcome since the second quarter of last year.
Manufacturing production expanded at the fastest pace in nine months during March, underpinned by the steepest gain in incoming new business since July 2014. The strong domestic market remained the principal source of new contract wins
There was also better news for exporters in the form of a modest increase in overseas demand following a slight dip in February. Companies reported improved order inflows from a broad range of nations including the USA, China, Germany, the Netherlands, Canada and the Middle East.
Manufacturing employment increased for the twenty-third consecutive month in March, with further job creation recorded at both SMEs and large-scale producers. Along with the increases in new orders and output, companies also linked higher workforce numbers to the clearing of backlogs.
Lee Hopley (pictured), chief economist at EEF, the manufacturers' organisation, said: "Coming on the back of official data confirming a very healthy rate of manufacturing growth last year, the PMI suggests that, if anything, the sector has stepped up a gear this year.
"While healthy domestic demand has become familiar over the past year or so, evidence is also mounting that the sector's export prospects are turning a corner across a range of markets.
"The pick-up in new business will have been aided by strengthening activity in much of the eurozone."
Rob Dobson, senior economist at Markit, added: "The sector is on course for output growth ranging around 0.6% over the opening quarter as a whole, a positive contribution to broader economic expansion and its best performance since the first half of last year.
"Continued job creation of around 5,000 new manufacturing employees a month also provides a decent bellwether that the labour market is still strengthening. Meanwhile, price pressures are heavily weighted towards the downside, with input prices falling at a double-digit rate."
