Together with ASB Law and Barclays, we hosted our quarterly manufacturing forum where there were over 30 attendees. The aim of the forum is to focus on matters and events that have bearing on the manufacturing sector and to provide insights and information to our attendees.
We are delighted to be sponsoring the Sussex Chamber manufacturing forum being held on Thursday 23 May at Welland Medical, Crawley. Gatwickpartner Allan Pinner, who is also a member of the Sussex Chamber Manufacturing Forum, will be leading our sponsorship of the event.
A recent survey has revealed that manufacturers panic stockpiled in March, as the UK headed towards a possible no-deal Brexit, it was this stockpiling activity that saw a 13-month high for the sector.
Manufacturers’ concerns regarding imports and exports being held up at the UK border led to raw materials and finished goods being purchased at the fastest monthly rate of any G7 country since 1992. This was all designed to create “buffer stocks” in their warehouses.
Amid all the hot air and uncertainties of Brexit, one thing is clear; February’s Bank of England (BoE) inflation report shows that global trade winds are buffeting economic activity. The growth in world trade in goods reduced from 5% to 3% in the three months to November 2018 and a slowing of activity in the Eurozone (and between the US and China) even led German economic output to contract. This sluggish growth has also dampened the paths of interest rates, whose planned trajectories across the US, UK and the Euro area have all flattened.
UK private businesses remain remarkably pragmatic, however.
The services sector of the UK economy seems to have taken a very low profile, and pragmatic approach, to the pending question of whether the UK exits the EU under a negotiated deal or crashes out with no transition arrangement under World Trade Organisation (WTO) rules.
The months of August and September showed a dramatic fall in output and activity when compared to July, and with last week’s economic results demonstrating a 0.6% GDP growth for the 3rd quarter of 2018 - there was no surprise the results were greeted with muted responses. And, the most unexpected result to emerge was the 1.2% fall in investment spending which is the largest fall since early 2016.
There is some good news in the 2nd quarter results with overall UK GDP growth of 0.4% which is up from the 0.20% in Quarter 1. Encouraging but fragile, with the UK economy growing at less than a quarter of the growth of the US economy.