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UK factory output rises at fastest pace since 1995

UK factory output rises at fastest pace since 1995

LONDON: British manufacturing output increased at its fastest rate since the mid-1990s over the past three months, despite orders slowing in July, an industry survey showed on Tuesday. The Confederation of British Industry’s quarterly balance for manufacturing rose to +31 in the three months to July, the highest reading since January 1995 and up from +22 in the three months to April. In July alone, however, new orders slowed slightly more than expected, with the CBI’s monthly balance slipping to +10 from +16 in June.

Although export orders slowed in the three months to July, manufacturers’ optimism about exports over the coming three months rose the highest in 40 years. “It’s great to see the benefits from the decline in sterling for UK exporters feeding through,” said Rain Newton-Smith, the CBI’s chief economist. “But the flip side is the broader hit to consumer spending power across the economy from stronger inflation, which is likely to have fuelled the slowdown in the economy in Q1 and is expected to pull down growth in Q2,” she added. The CBI survey is at odds with official data that paints a much more muted picture of British industrial output and exports.