UK manufacturing boosted by overseas demand

“The long awaited rebalancing of economic growth may also finally be within sight," he said. "New export orders are rising at one of the fastest rates ever recorded by the survey as global demand also undergoes a broad-based upswing."

Economists also said Britain would largely weather the storm hanging over emerging markets. "We also do not expect serious fall-out for the UK from the emerging market wobbles.," said Rob Wood, chief UK economist at Berenberg Bank. "The EU and the US account for the bulk of UK trade, dwarfing Turkey and Brazil, and both of the former regions are improving."

Although the Markit/CIPS headline manufacturing PMI eased to 56.7 in January, below market expectations of 57.3 and down from December’s reading of 57.2, it was still well above the historical average of 51.3, and well above the 50 level that divides expansion from contraction.

Other analysts said PMIs tended to overstate the health of the UK economy. "The CIPS survey’s predictive power seems to have weakened recently – it also pointed to quarterly growth in manufacturing output of about 2pc in Q3 and Q4, but the official figures have recorded growth of only 0.8pc and 0.9pc respectively," said Samuel Tombs, an economist at Capital Economics."

"Nonetheless, these growth rates are still respectable. And the outlook for manufacturers remains relatively bright. While the stronger pound may begin to hinder a recovery in exports, the easing of both credit constraints and the squeeze on households' real pay should support a further revival in domestic demand for investment and consumer goods."

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