Weak pound gives British industry an export boost

Manufacturers enjoyed another bumper month in May as the weak pound boosted exports.

Figures today showed the recovery in the sector continued at pace last month amid strong demand for British-made goods overseas.

Rob Dobson, senior economist at Markit, said: "UK manufacturing maintained its blistering start to the second quarter.

Although production remains well below pre-recession levels, the sector is now recovering its losses at a surprisingly rapid pace."

The Chartered Institute of Purchasing and Supply said its index of activity — where anything above 50 represents growth — held firm at 58 in May.

That was the same reading as the near 16-year high recorded in April and the eighth-consecutive month of expansion.

CIPS chief executive David Noble said: "The strength of recovery has taken everyone by surprise.

"We can't forget this has been driven by the weak sterling exchange rate bolstering export demand.

"Problems in countries such as Greece and Spain have strengthened the pound against the euro recently and could also have a severe impact on the eurozone economy.

"Given the euro countries are Britain's biggest trading partners, any double-dip recession there would undoubtedly damage the UK manufacturing sector."