Figures for this May indicate that the manufacturing sector in the UK turned in its worst performance for three years. The Markit/CIPS manufacturing Purchasing Managers’ Index had dropped to 45.9 –  down from 50.2 in April.  A reading below 50 indicates contraction.

According to the survey, manufacturers had cut back on output, employment, purchasing and inventories.

The index had fallen 4.3 points in May, the second-steepest fall in its 20-year history, with chemicals and plastics, electrical, mechanical engineering, textiles and clothing, and transport the sectors most affected.

Although manufacturing accounts for only 10% of UK GDP, some analysts say the disappointing figures will put more pressure on the Bank of England’s Monetary Policy Committee to restart its policy of quantitative easing – the process of buying up government and other securities to boost the money supply and promote institutional lending.