FEARS that UK manufacturing has lost momentum have been fuelled by a survey revealing order books in the sector are, overall, in their worst shape since autumn 2016.

The survey also signals that growth in

UK manufacturers’ overall output volumes nearly ground to a halt in the past three months.

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Of 411 manufacturers surveyed by the Confederation of British Industry, 25 per cent reported order books were below-normal and only 22% said they were better than usual. The remainder reported order books were at normal levels. The net 3% reporting below-normal order books was the weakest reading since November 2016. And the survey signals particular weakness in domestic orders, as well as a cooling on the export front in recent months.

In the previous month’s survey, a balance of 4% of UK manufacturers had reported above-normal order books. And, as recently as January, a net 14% had said their order books were above normal.

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A balance of 8% of UK manufacturers said their export order books were above normal in the latest survey, little changed from a balance of 9% reporting such a position the previous month. However, in the November survey, a net 20% had reported above-normal export order books.

In the latest survey, only a net 3% of UK manufacturers reported a rise in output volumes during the past three months. A balance of 13% recorded an increase in output volumes over the previous three months in the CBI’s April industrial trends survey. The latest reading for output volumes signals the weakest growth since April 2016.

Figures last month from the Office for National Statistics showed the UK economy grew by just 0.1% in the first quarter. Manufacturing growth slowed to 0.2%.

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Anna Leach, head of economic intelligence at the CBI, said of the results of the latest industrial trends survey: “UK manufacturing has lost some steam since the start of the year, on the back of a softening in both domestic and global growth.”

She added: “While global economic growth – particularly in the EU – has disappointed

in the first quarter of the year, demand

from overseas continues to shore up manufacturing activity in the UK, with export

order books remaining well above [the] historical average.”

Howard Archer, chief economic adviser to the EY ITEM Club think-tank, said: “The May CBI industrial trends survey points

to the manufacturing sector losing

further momentum, thereby extending the weakened performance seen in 2018 compared to the robust performance in

the second half of 2017. Softer domestic demand was the main factor behind May’s weakened orders and it has come well off the peak levels seen in December [and] November.”

UK manufacturers were upbeat about the prospects for growth in output volumes over the coming three months, with a net 27% projecting a rise. The CBI survey was conducted between April 25 and May 11.