Robust demand for UK manufacturing

Demand for UK manufactured goods has continued to grow apace, according to the latest quarterly survey of Industrial Trends by the CBI.

According to the survey, growth in manufacturers’ total new orders is stronger than at any time in the last decade, other than during a short period in 2004. Levels of export orders have so far withstood the strengthening pound to remain steady over the last three months.

Growth in output is reported to have slowed slightly in this survey, but the highest balance of firms for over two years now expects output growth to increase over the next three months.

Manufacturers are managing to rebuild profit margins, after unit costs rose at the slowest pace for two years while prices increased at a similar rate to last quarter. Cost pressures are expected to ease further during the coming months.

Business sentiment has improved, with the highest balance since January 2004 feeling more optimistic about the general business situation than three months ago.