PMI forecasts strong second quarter

At 58 in April, from an upwardly revised figure of 57.3 in March, the seasonally adjusted PMI rose to its highest level since September 1994.

Manufacturing production increased for the eleventh month running in April, with the rate of expansion only slightly below March’s 15-and-a-half year high.

Underpinning the latest rise in output was the sharpest growth in total new business since January 2004 and a series record increase in new export orders. The forward-looking new orders to inventories ratio also stayed at an elevated level, suggesting production will continue to rise at a rapid pace in coming months.

Higher levels of total new work reflected improved global market conditions, client restocking and successful product promotions.

Increased overseas sales were particularly commonly reported from customers in China, mainland Europe, the Middle East, North America and Scandinavia, in many cases aided by the ongoing weakness of the sterling exchange rate.

The rate of expansion in output was strongest in the intermediate goods sector. Manufacturing employment increased for the third time in the past four months in April and at the fastest rate since February 2007. This followed the sustained period of job cutting seen throughout much of 2008 and 2009.