"These figures imply that manufacturing was a drag on overall growth in the second quarter and we expect GDP to decline for the third consecutive quarter"
- Nida Ali, economist at Ernst & Young ITEM Club
U.K. manufacturing sector contracted modestly in June, Markit data showed on Monday. The manufacturing purchasing managers' index increased to 48.6 from 45.9 in May. A reading below 50 signals contraction.
"These figures imply that manufacturing was a drag on overall growth in the second quarter and we expect GDP to decline for the third consecutive quarter," said Nida Ali, economist at Ernst & Young ITEM Club.
"The data is merely telling us that the pace of contraction has slowed rather than the sector is expanding," said ING economist James Knightley.
"Consequently, this is not going to block a further round of quantitative easing from the Bank of England on Thursday given the tone of recent BoE comments and the fact that the vote was so close last time."
© Dukascopy Bank SA