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Manufacturing output growth improves

Expectations for manufacturing output growth have improved, while order books are showing signs of recovery during June, according to the CBI.

The Industrial Trends Survey indicated that 27% of manufacturers expect their output volume to increase over the next quarter, while 19% anticipate a decline. This results in a rounded balance of 7%, which marks an improvement on the negative figure recorded in May. However it is still below the figures seen in the early part of 2012.

Orders also improved in June, as 17% reported that order books were above normal, and 28% below. The -11% balance is an upturn from last month, and above the long running average of -17%.

Export orders have also strengthened with a balance of -4% - higher than the long-run average of -21%.

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.”

Expectations for output price inflation has weakened, and a balance of 2% of firms expect to increase output prices over the next quarter, the lowest balance since November 2011.

Stock levels are under control, with a balance of 16% indicating that stocks are adequate to meet demand, in line with their long run average.

This was posted in Bdaily's Members' News section by Ruth Mitchell .