The Confederation of British Industry (CBI) has announced that the manufacturing industry is ‘showing signs of stability’.
The body conducted a survey of 482 manufacturers which revealed that total order books were slightly strengthened in the three months to June which were led by the motor vehicles & transport and the food and drink sector.
Similarly, the total export order books stayed the same, which suggests that the depreciation of Sterling has not yet had a material impact on demand from overseas demand.
Meanwhile, output growth remained brisk, with companies increasing their expectations for the next three months from June. Selling prices are also expected to be stable at least in the short term.
CBI chief economist, Rain Newton-Smith, said that the pound’s recent fall seems to have done little for our exporters.
He suggested that it could be the growing uncertainty in the build up to the referendum on Britain’s future in the European Union, along with global risks elsewhere, that has offset some of the benefits of a weaker currency at the current time.
He added that there are more positive signs as output and demand stabilise, despite a tricky start to the year for British manufacturers.
Elsewhere in the results, 23% of businesses reported a decrease in total orders, while 20% posted an increase, which gave a rounded balance of -2%.
27% of businesses reported a decrease in export orders, whereas 13% revealed a decrease, and resulted in a balance of -14%.
Nearly a third (30%) of businesses posted an increase in output volumes, with 19% reporting a decrease, and gave an overall balance of +11%.
Over the next three months, it is anticipated that output is to increase, with 35% of businesses expecting to see a rise, with just 13% forecasting a decrease, which leaves a rounded balance of +23%.