UK factory orders contract again but price pressures ease – CBI
2023.04.25 06:38
© Reuters. FILE PHOTO: A worker cuts newly manufactured bars of steel at the United Cast Bar Group’s foundry in Chesterfield, Britain, April 12, 2022. Picture taken April 12, 2022. REUTERS/Phil Noble
LONDON (Reuters) – British factory orders and output contracted as stocks of finished goods piled higher, according to a survey on Tuesday that underlined the recent weak performance of the manufacturing sector but also pointed to easing inflation pressures ahead.
The Confederation of British Industry’s (CBI) monthly gauge of industrial orders held at -20 in April, unchanged from March’s reading that had marked a more than two-year low.
The survey’s measure of stocks of finished goods rose to +19, the highest reading since August 2020, pointing to weak output in the months ahead.
On the plus side for the Bank of Engbland as it ponders how much further to raise interest rates to curb the jump in inflation, cost pressures receded further.
“Growth in average costs per unit of output and growth in average domestic prices have now slowed for four successive quarters. Manufacturers expect growth in costs and domestic prices to ease further in the quarter to July,” the CBI said.
Official data show manufacturing output has been largely flat since mid-2022, along with the broader economy, with construction the sole bright spot.
The CBI’s quarterly measure of manufacturing business sentiment rose to -2 from -5. While still in negative territory, it marked the highest reading since October 2021.
