UK manufacturers’ expectations for output growth have improved, while firms’ order books showed signs of recovery , the CBI has said.
Of the 459 manufacturers responding to the latest monthly Industrial Trends Survey, 27 per cent expect to increase their volume of output over the course of the next three months, while 19 per cent expect it to fall. The rounded balance of +7 per cent marks an improvement on the negative figure recorded in May, though still below those seen in the early months of the year.
The flow of orders saw an improvement in June, with 17 per cent reporting that order books were above normal. With 28 per cent stating that order levels were below normal, the balance of -11 per cent represents an upturn from last month (-17 per cent) and is above the long-run average (-17 per cent). Likewise, export orders also strengthened with a balance of -4 per cent, well above the long-run average of -21 per cent.
Expectations for output price inflation have weakened. A balance of only +2 per cent of firms expect to increase output prices over the next quarter, the lowest balance since November 2011 (+2 per cent).
Stock levels remain under control, with a balance of +16 per cent saying stocks are at least adequate to meet demand, and in line with their long-run average (+14 per cent).
Ian McCafferty, CBI chief economic adviser, said: “Despite facing continued instability within the Eurozone, UK manufacturers have seen a modest re-bound in orders from both their domestic and export markets. As a result, firms are expecting output to pick up over the next quarter, although the pace of growth is still expected to be somewhat lower than earlier in the year.”