- Markit economist Rob Dobson
Manufacturing activity in the U.K. shrank for the sixth month in a row in October, as the number of new orders fell, while costs rose at a faster pace. The market research group Markit said its index of manufacturing activity fell to 47.5 from a downwardly revised 48.1 in September. The U.K. has just emerged from the double-dip recession, with nation's GDP expanding 1% in the third quarter, but the latest data add to fears that the recovery may run out of steam.
"It won't swing the (QE) decision massively, it's going to be a close call whatever way you look at it and inflation risks have moved up and certainly that will be something the committee are going to look at pretty closely," said Investec economist Victoria Clarke.
"Manufacturers remained cost-cautious overall, leading to lower levels of purchasing and further depletion of inventory holdings. The rate of reduction in input buying volumes accelerated sharply and was one of the fastest signalled during the past three-and-a-half years," said Markit economist Rob Dobson.
The FTSE 100 Index edged higher 1.37 per cent to 5,861.92. The broader FTSE All-Share Index rose 1.33 per cent to 3,064.73.
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