The IHS Markit/CIPS UK Manufacturing Purchasing Managers' Index (PMI) dropped to 56.3 from 58.2 in November, at the bottom end of forecasts in a Reuters poll of economists that had pointed to a reading of 58.0. The increase was driven by stronger new order growth and the fastest rise in employment in the sector since the survey began in 1998.
Demand from North American customers was particularly strong during December, the report found. In response to greater inflows of new business, job creation quickened to the greatest since August 2012.
This signalled a broad stagnation in the goods-producing economy, following the strongest growth in over three-and-a-half years in the previous month.More news: Bears Expected to Fire John Fox
Factory Purchasing Managers' survey from euro area and the United Kingdom are due on Tuesday, headlining a light day for the European economic news.
The country's manufacturing PMI has been in positive territory for 17 months in a row despite overall slower expansion this month. In turn, new export orders rose at the quickest pace since June.
The new order index of the non-manufacturing businesses stood at 52 in December, up 0.2 points from a month ago.More news: OH minimum wage increases
"Manufacturers will be looking to the new year for the progress on the National Energy Guarantee and other measures to put downward pressure on business costs", Mr Willox said.
"(British manufacturing) broadly maintained its solid boost to broader economic expansion in the fourth quarter", said Rob Dobson, director at PMI compiler IHS Markit.
Both new export orders and overall new business received by manufacturers increased at the quickest clip in four months, according to the survey, which is sponsored by Caixin and compiled by global information and data analytics provider IHS Markit Ltd.More news: Trump reportedly fires entire HIV/AIDS council without warning
Despite its stable economic growth trend, China also faces some challenges, such as an increase in raw materials prices and rising corporate costs, said Chen of China Logistics Information Center. "This outlook was shared by the manufacturing community as sentiment picked up to the strongest in three months amid expected improvement in market conditions over the next 12 months", Dodhia added.