During March, UK factories stockpiled resources at an explosive rate in preparation for Brexit. This was an unexpected 13-month high, something that has been unseen before in a major rich economy.
The IHS Markit/CIPS UK Manufacturing Purchasing Managers’ Index (PMI) rocketed to 66.2 in March from 59.9 in February. This is the highest PMI seen in a Group of Seven rich country since IHS Markit’s records began in 1992.
This stockpiling could effect manufacturers’ operating profit. A decline in profit would leave less money for investment and therefore the UK’s economy to decline even further.
Quote from Nigel Holland:
“With the deadline for Brexit extended until April 12th, stockpiling is set to carry on for at least another week. In the meantime all we can do is hope for a good ending to this chaotic separation from the EU.”