The U.K. manufacturing sector continued to expand in September, after falling sharply in the immediate aftermath of Britain’s vote to leave the European Union, a survey showed Monday.
This will likely boost the ruling Conservatives’ moods as they prepare to chart the country’s departure from the 28-country bloc. Prime Minister Theresa May has signaled she would be launching the formal exit procedure by the end of the first quarter of 2017, beginning a two-year negotiation period.
The purchasing managers index for the manufacturing sector rose to 55.4 in September, financial information firm IHS Markit Ltd. said. That was above forecasts from analysts polled by The Wall Street Journal, who predicted a slower pace of expansion, and above the revised August figure of 53.4. Readings above 50 signify growth.
The sector’s output, new orders and employment all strengthened in September, the survey showed. The expansion was driven by the weakened sterling, which boosted orders from overseas, and by still-strong domestic demand.
“The rebound over the past two months has been encouragingly strong, and puts the sector on course to provide a further positive contribution to [gross domestic product] in the third quarter,” said Rob Dobson, senior economist at IHS Markit.