UK and US Manufacturing Sectors Expand in August

Manufacturing sectors in the UK and US both recorded growth in August, though both experienced slight decelerations in their respective activity gauges. In the UK, the purchasing managers' index fell to 51.7 from July's 51.9, marking the slowest expansion in five months. Despite this, the sector has grown for 10 consecutive months, supported by rising export orders to the US, China, Western Europe, and the Middle East.

S&P Global reported that UK employment growth reached a two-year high to address production backlogs, though a performance gap emerged between larger firms and struggling small and medium-sized enterprises. While input price inflation reached its lowest level since February, analysts warned that energy costs and Middle East instability remain risks.

In the US, manufacturing expanded for the eighth straight month with a gauge reading of 54.6, the second-highest since 2022. Growth was driven by resilient consumer demand, business investment, and government defense spending across 15 industries. However, the Institute for Supply Management noted that new orders hit their lowest level since March, while manufacturers continued to struggle with supply-chain disruptions and volatility in the Strait of Hormuz.