The Remainers are out today gleefully pointing at the latest manufacturing research and saying there is a slowdown and it's all down to Brexit.

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There is a slowdown in manufacturing and Brexit uncertainty may be playing its part, but there is a much wider picture to look at.

The latest figures from IHS Markit/CIPS show that the UK manufacturing Purchasing Managers' Index or PMI had fallen from 53.1 in April to 49.4.

Now, anything above 50 indicates optimism and growth, while anything below 50 indicates pessimism and contraction.

Now. although Brexit uncertainty is mentioned several times in the Markit Economics report on the UK, you only have to go through the many press releases issued today from them to see that manufacturing is taking a global hit.

Here are some for you:

Brazil dropped from 51.5 in April to 50.2 in May, the lowest in ten months.

Greece fell from 56.6 to 54.2.

Canada went from 49.7 to 49.1.

Germany fell from 44.4 in April to 44.3 in May and is one of the lowest readings since mid 2012 reports Markit.

France though saw an increase from 50 to 50.6, as did Italy which went from 49.1 to 49.7, while Spain fell from 51.8 to 50.1.

But the Eurozone overall is was at 47.7 in May, which is the fourth month in a row that it has been below 50.

Now back to the sharp fall seen by the UK from 53.1 in April to 49.4 in May. This says Markit is down to the fall off in stockpiling by firms in the run up to Brexit.

That I would think may be down to the warehouses now being full.

Without that activity our previous few months PMI figures may well have been lower.

But I think you can see from the snapshot that I've given you that the slowdown is not just in Brexit UK.

The Guardian is running a live article as the data comes in and the main worry across the board for everyone is a global slowdown and Morgan Stanley says there could be a recession within a year, if the trade war between the US and China gets any worse.

While Goldman Sachs says it thinks there's now a 60% chance of the US imposing trade tariffs on all Chinese goods.

And the French CAC, Germany's DAX and the UK FTSE have all dropped as a result.

So, when reading in our Remainer press that Brexit is to blame, I would say it is the uncertainty caused by not delivering Brexit coupled with a huge global slowdown driven by a US-China trade war, that is the problem.

Sources:

https://www.markiteconomics.com/Public/Home/PressRelease/eafabe8382054b868b618dcf6f0b98d8

https://www.theguardian.com/business/live/2019/jun/03/trade-war-market-sell-off-china-us-manufacturing-eurozone-uk-brexit-business-live

https://www.markiteconomics.com/Public/Release/PressReleases?language=en

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