LONDON, Oct 1 Reuters British manufacturers turned much more pessimistic in September on worries about the new government39;s first budget combined with concerns about conflict in the Middle East and strong inflation pressures, a survey showed on Tuesday.

The SP Global UK Manufacturing Purchasing Managers39; Index edged down to 51.5 matching the preliminary September estimate from a more than twoyear high of 52.5 in August.

The PMI39;s measure of business optimism about the year ahead tumbled to a ninemonth low.

The extent of the drop in confidence was striking, beaten only by that seen in March 2020 prior to COVID lockdowns, said Rob Dobson, director at SP Global Market Intelligence.

Uncertainty about the direction of government policy ahead of the coming Autumn Budget was a clear cause of the loss of confidence, especially given recent gloomy messaging, though firms are also worried about wider global geopolitical issues and economic growth risks.

Prime Minister Keir Starmer and his finance minister Rachel Reeves have warned of the need for higher taxes in the Oct. 30 budget and they have also talked about the dire state of the economy that they inherited from the previous government.

Recent surveys of consumer confidence have also shown a drop.

The manufacturing PMI showed export orders dropped again, due in large part to economic weakness in France and Germany, extending their nearly threeyear run of falls.

Prime Minister Keir Starmer and his finance…