The S&P Global/CIPS UK Manufacturing PMI was revised slightly higher to 49.3 in February of 2023 from a preliminary of 49.2, pointing to the smallest decline in factory activity in seven months.
The downturn in output halted, and production rose for the first time in eight months, as stabilising client demand and improved supply chains boosted production.
Also, new orders fell less and inflationary pressures also eased further, with costs rising to the least marked extent since July 2020.
Meanwhile, February saw average vendor lead times shorten for the first time since June 2019 while employment continued to decrease.
Manufacturing employment decreased for the fifth successive month in February.
The outlook for the manufacturing sector also strengthened in February. Business sentiment improved for the third month running and to its highest level in a year.
Finally, business sentiment improved for the third month running and to its highest level in a year, prompted by expectations of improved economic conditions, new product launches, planned investment and reduced supply chain issues.
Commenting on the latest survey results, Rob Dobson, Director at S&P Global Market Intelligence, said: "Manufacturers' confidence also strengthened, with 60% of companies forecasting production will expand during the coming year. Part of the reason for renewed optimism was a near-stabilisation of new order inflows in February, with total new orders and new export business both falling only slightly and to much lesser extents than in recent months."
Dr. John Glen, Chief Economist at the Chartered Institute of Procurement & Supply, said: "Driven by improvements in supply chain deliveries and more stable price rises, the manufacturing sector reported a more upbeat assessment of the state of play for makers in February and output rose for the first time in eight months. A stronger global economy reflected in less caution in the UK marketplace and though new order levels were still deteriorating, the falls were less marked."
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UK factory output falls less than anticipated in February