UK manufacturing sector to recoup some of the July fall

The sector appears to be weakening with surveys showing significant declines from the peak readings of 2013 and 2014. However, the output indices within the surveys still signal positive output growth which does not fit with the official data. At the very least there has been a loss of momentum which attributed to the recent falls in export orders. The survey output indices have been stable since April yet by July the level of output had fallen by 1.3%. Moreover, it has also been highly volatile, falling by 0.8% mom in July. 

"We think that exaggerates the slowdown, and so we expect a bounce of 0.4% mom in August", says Societe Generale.