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UK manufacturers report modest growth in orders

UK manufacturers have enjoyed a modest improvement in their order books in the latest month, a survey from the Confederation of British Industry has revealed.

However, although export as well as total order books showed some improvement after a deterioration in January, the survey signals that business from overseas is weaker than it was at the end of last year.

Of UK manufacturers surveyed by the CBI between January 22 and February 13, only 15% believed their total order books were above normal and 29% viewed them as worse than usual, with the remaining 56% reporting a normal position.

The resultant net 14% reporting below-normal order books was a significant improvement on a corresponding balance of 20% in last month's survey.

Only 5% of manufacturers viewed their export order books as better than usual. With 25% considering them worse than usual, a net 20% reported below-normal export order books.

This was not as bad as the net 29% reporting below-normal export order books in last month's survey, but was worse than a corresponding balance of 11% in December.

Looking ahead, 24% of manufacturers forecast a rise in output volumes over the next three months and 19% projected a fall.

The net 5% predicting a rise in output volumes represented a deterioration from a corresponding balance of 8% in last month's survey.

Samuel Tombs, UK economist at consultancy Capital Economics, said the CBI survey "indicates that the manufacturing sector is recovering at a pretty sluggish pace".

He said the fall in the output expectations balance to 5% left it consistent on the basis of past form with quarterly growth in manufacturing output of "just 0.2%".

Mr Tombs added: "The latest surveys from the eurozone suggest that the UK's biggest export market is still in recession.

"As a result, there seems little reason to expect the industrial sector to materially support growth in the overall economy this year."

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