UK manufacturers see rise in order books despite slowdown

The UK manufacturing sector received mixed news this week after a survey showed a big proportion of firms were planning further price rises but enjoyed an increase in their order books this month.

Business lobby group the CBI said a balance of 28 per cent of companies expected to put prices up over the next quarter.

The figure was 2 per cent down on the previous month, which was the highest reading for 13 years, but still remains at the top end of survey history.

Despite the inflationary pressure, respondents said their business had improved over the past month, with plus 1 per cent reporting their order books were "above normal" in June. This compared with 10 per cent who said order levels were below normal in May.

A balance of 2 per cent of firms also said their volume of output was expected to increase over the coming quarter, up from zero last month.

The CBI's chief economic advisor Ian McCafferty said: "Manufacturing demand is holding up reasonably well. Manufacturers, especially those exposed to the global economy, have been less affected by the slow down in domestic spending and other sectors.

"At the same time however there has been no let up from higher costs on manufacturers, and the CBI's data shows firms still having to pass them on in higher prices."

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