Factory orders slip fuels fears over recession

The Markit Purchasing Managers’ Index (PMI) recorded a level of 49 for August – a reading above 50 indicates growth – down from a revised reading of 49.4 in July.

The volume of new orders declined for the fourth month running in August, recording the sharpest fall since April 2009 and painting a bleak picture on the outlook for industry.

Samuel Tombs, UK economist at Capital Economics, said: “All in all the survey highlights the increasing risk that the industrial sector – and perhaps even the overall economy - is heading for a double-dip.”

The dismal figures will come as a blow to Chancellor George Osborne, who is banking on the private sector to keep the economy afloat as he rolls out a package of public sector cuts.