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UK manufacturing industry shrinks at fastest rate in 11 months

Concerns remain about the outlook for global trade in 2025, with Donald Trump assuming the US presidency later this month having promised a slew of trade tariffs.

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Yahoo!finance: British factory output contracted at the fastest rate in 11 months in December, amid a swathe of job losses, growing concerns about rising business taxes and a worsening global economy.

The S&P Global UK manufacturing PMI survey, watched closely by economists, recorded a reading of 47.0 in December, from 48.0 in November.

Any reading above 50 indicates activity is growing while any score below means it is contracting.

The rate of job cuts hit a 10-month high, the survey found, with firms saying weak market conditions caused many to reduce their headcounts.

Company confidence fell to a two-year low, meanwhile, amid concerns about inflationary pressures, rising business costs and potential weaker economic growth this year.

Manufacturers said they were concerned about future cost increases, partly driven by rising taxes announced by Chancellor Rachel Reeves last year.

Companies will pay more in national insurance contributions (NICs) from April, while the minimum wage is also set to rise, which will make it more expensive to employ people.

Firms also cited a weakening global economic outlook, as exports fell due to lower demand in Europe, Asia and the UK.

Concerns remain about the outlook for global trade in 2025, with Donald Trump assuming the US presidency later this month having promised a slew of trade tariffs.

Rob Dobson, director at S&P Global Market Intelligence, said: “A stalling domestic economy, weak export sales and concerns about future cost increases led to the steepest contraction of UK manufacturing production for almost a year in December.

“Manufacturers are facing an increasingly downbeat backdrop. Business sentiment is now at its lowest for two years as the new Government’s rhetoric and announced policy changes dampen confidence and raise costs at UK factories and their clients alike.

SMEs are being especially hard hit during the latest downturn.

“This is sending a winter chill through the labour market. December saw the sharpest cuts to staffing levels since February.

Some companies are acting now to restructure operations in advance of the rises in employer national insurance and minimum wage levels in 2025.”

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International

Putin bans foreign-made clothing for Russian army from 2026

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• Russian President Vladimir Putin

Russian President Vladimir Putin has signed a decree banning the procurement of foreign-made clothing and related gear for the country’s armed forces starting in 2026.

According to the decree, from Jan. 1, 2026, all uniforms and other clothing items for the Russian Armed Forces must be produced by Russian companies whose manufacturing facilities are located within the country.

By 2027, the requirement would extend to fabrics and knitted materials used in production, which must be domestically manufactured.

The measure aims to entirely exclude the purchase of foreign-made clothing and materials for the needs of the military, the decree said.

Military clothing and gear include uniforms, insignia, underwear, bedding, special clothing, footwear, equipment, and sanitary items.Such supplies are procured through the Russian state defence order system.

(Xinhua/ NAN)

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International

Train derails injured 30 in Iran

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A train derailed in the southern Iranian province of Kerman on Friday, injuring more than two dozen people though no deaths were reported, according to local media.

“Thirty people were injured when a train derailed on the Kerman-Zarand railway path,” Babak Mahmoudi, head of the Red Crescent Society’s Relief and Rescue Organisation, told the Mehr news agency.

A statement from the public relations office of the national railway body carried by the Tasnim news agency reported that after “the timely arrival of railway technical personnel and rescue forces, all passengers safely exited the train”.

Train derailments are not uncommon in Iran, and while they do not generally result in deaths, there have been fatal disasters in the past.

In June 2022, 21 people were killed and dozens were injured when a train derailed near the central Iranian city of Tabas after hitting an excavator beside the track.

In 2016, two trains collided and caught fire in northern Iran, killing 44 people and injuring scores.

AFP

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International

U.K.–India set to boost bilateral trade by over $34 billion a year

The FTA, which slashes duties on goods including textiles, alcohol and automobiles, was signed Thursday in the presence of Indian Prime Minister Narendra Modi and his UK counterpart, Keir Starmer.

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•Indian Prime Minister Narendra Modi and his UK counterpart, Keir Starmer.

U.K. and India’s bilateral trade is set to get a more than $34 billion annual boost over the long term following their free trade agreement, with the countries’ leaders calling it a “historic” deal.

CNBC reported that the FTA, which slashes duties on goods including textiles, alcohol and automobiles, was signed on Thursday in the presence of Indian Prime Minister Narendra Modi and his UK counterpart, Keir Starmer.

Both sides had finalized the trade pact in May after three years of intense negotiations — marked by thorny issues such as visas, tariff reduction and tax breaks.

Talks gained momentum and both governments accelerated to seal the deal as U.S. President Donald Trump’s tariff threats sent the world in disarray.

The agreement between the world’s fifth and sixth largest economies is expected to boost their bilateral trade by 25.5 billion pounds per year by 2040.

Trade in goods and services stood at over 40 billion pounds in 2024.

The deal offers “huge benefits to both of our countries,” boosting wages, raising living standards and bringing down prices for consumers, Starmer said.

India’s Modi lauded the agreement as “a blueprint for our shared prosperity,” highlighting how Indian goods including textiles, jewelry, agricultural products and engineering items would benefit from a better access to the U.K. market.

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