Britain's manufacturing sector contracted at its fastest pace in a year last month, according to the Chartered Institute of Purchasing and Supply (CIPS). It said its manufacturing index fell to 48.6 in January from a downwardly revised 49.3 in December, where a reading below 50.0 indicates contraction. This is the second straight month that the CIPS index has registered a reading under the stable level and the institute noted that the index has not registered back to back contraction since the beginning of last year.
"Although a significant amount of the total decline in new orders reflected seasonal factors, a number of panelists indicated that business had suffered as a result of uncompetitive UK markets," CIPS added. The new orders sub-index also showed an increase in the pace of contraction, falling to 48.7 in January from 49.7 in December, while the employment sub-index dropped to 45.9 from 47.1, indicating that companies are cutting more jobs amid a slowdown in business//www.fxcentre.com