Coronavirus threat bugs UK economic recovery
The service, construction and manufacturing sectors in the UK economy have all made unexpectedly healthy starts to 2020, but growth is now being threatened by the threat of the coronavirus to global trade.
Meanwhile, this week's PMI for the construction industry in February showed output rising at its fastest rate in more than a year, jumping to 52.6 from 48.4 in January. New orders rose at their fastest pace since 2015.“As the blocks of December’s election and Brexit uncertainty were largely removed, it was the residential sector that was the main winner with the fastest escalation in housebuilding since July 2018,” said Duncan Brock, group director at the Chartered Institute of Procurement & Supply.Tim Moore, economics director at IHS Markit, said: “While construction order books have begun to recover in the opening part of 2020, the fly in the ointment is the uncertain impact of the coronavirus outbreak on UK economic growth prospects. A renewed slowdown could see domestic investment spending put back on hold and dampen the outlook for the UK construction sector.”For manufacturing, last month's PMI for manufacturing rose to 51.7, up from 50.0 in January. But, again, the global impact of coronavirus was seen to be weighing on a post-election recovery in the sector, with factories reporting a surge in delays in their supply chains.Rob Dobson, a director at IHS Markit, said new orders grew at their fastest pace in 11 months and business optimism had hit a nine-month high. But he added manufacturers were still in recovery mode after Prime Minister Boris Johnson’s election win in December, which had lifted some of the uncertainty hanging over the country’s economy. Subscribe to Relocate Extra, our monthly newsletter, to get all the latest international assignments and global mobility news.Relocate’s new Global Mobility Toolkit provides free information, practical advice and support for HR, global mobility managers and global teams operating overseas.Access hundreds of global services and suppliers in our Online Directory
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