UK manufacturing conditions stabilise, finds CBI

Food and drink and car manufacturers led the way in the three months to June

Demand in the manufacturing sector was stable and output continued to expand at a solid pace, according to the latest monthly CBI Industrial Trends Survey.

The survey of 482 manufacturers reported that total order books strengthened slightly in the three months to June led by the food and drink sector, and motor vehicles & transport.

It found that 20% of businesses reported an increase in total orders and 23% a decrease, giving a rounded balance of -2%.

Meanwhile, 13% of companies reported an increase in export orders and 27% a decrease, resulting in a balance of -14%.

Output is expected to increase over the next three months and total export order books likewise remained unchanged.

Rain Newton-Smith, CBI chief economist, said: “The recent fall in the pound appears to have done little for our exporters. It may be that the growing uncertainty in the run-up to the EU referendum, combined with global risks elsewhere, has offset some of the benefits of a weaker currency at this time.

“But while British manufacturers had a tricky start to the year, there are more positive signs as output and demand stabilise,” she added.