UK manufacturing records strongest order book level for nearly 30 years
Total orders in the three months to November hit the strongest rate since August 1988.
Britain’s buoyant manufacturing industry has seen its strongest order book level for nearly three decades thanks to robust demand from overseas buyers, according to a report.
The Confederation of British Industry (CBI) industrial trends survey saw total orders in the three months to November hit the highest rate since August 1988, with the chemicals and food industries enjoying a bright period.
Export order books reached a joint 20-year high, as the Brexit-hit pound fuels an appetite for British goods by making them cheaper on international markets.
While output also accelerated during the period, growth is expected to slow for the three months to February.
Anna Leach, the CBI’s head of economic intelligence, said: “UK manufacturers are once more performing strongly as global growth and the lower level of sterling continue to support demand.
“Output growth has picked up again, and export order books match the highest in more than 20 years.
“Nonetheless, uncertainty continues to hold back investment and cost pressures remain strong.
“Manufacturers will be hoping the Budget brings some relief from the business rates burden in particular.”
The survey, which includes the views of 397 manufacturers, said total order books had a balance of plus 17%, with 28% of firms reporting levels above normal.
Output growth expectations for the upcoming quarter also enjoyed a positive balance of plus 13%, as 27% of manufacturers expect volumes to rise.
Howard Archer, EY ITEM Club’s chief economic adviser, said: “The CBI industrial trends survey points to manufacturing orders picking up strongly in November to be at the highest level for nearly 30 years.
“There was also a marked rise in the number of manufacturers reporting that their output had risen over the past three months.
“Specifically, the total orders balance surged to plus 17% in November – which was the highest reading since August 1988 – having previously fallen back to an 11-month low of minus 2% in October from plus 7% in September and plus 13% in August.
“It was substantially above the long-term average of minus 14%.”
The update comes after official figures published earlier this month showed the industrial sector has enjoyed a stellar run.
Industrial production unexpectedly grew by 0.7% month-on-month in September, recording its sixth straight month of growth for the first time in 23 years, according to the Office for National Statistics (ONS).
The statistics agency also revealed manufacturing output had climbed 0.7% in September, driven by “robust growth” in cars and medical equipment.
The UK economy accelerated to 0.4% in the third quarter, with the lion’s share of the expansion coming from the services and manufacturing industries.