Of the 548 manufacturers that responded to the CBI’s monthly Industrial Trends Survey, 25% expect output to rise in the next three months, while 18% anticipate a fall. The resulting balance of +7% is the strongest figure since March 2008 and compares with a balance of +4% in January.
Exports order books are continuing to improve thanks to the continued weakness of Sterling and improving global demand. 14% of firms said exports were above normal and 38% said they were below normal. The resulting rounded balance of -23% is the least negative since August 2008 and in line with the survey average.
Total order books, however, remain more depressed. 10% of manufacturers said they were above normal, while 46% said they were below normal. The resulting balance of -36% is the least negative since December 2008, and a modest improvement on the previous month’s balance of -39%.
Ian McCafferty, CBI chief economic adviser, said: “Manufacturing production is slowly recovering as demand for UK-made goods overseas is improving, boosted by the relative weakness of Sterling. Stock levels are now much closer to requirements, suggesting the period of aggressive destocking is now over.
“However, while exports are providing some welcome support, overall demand remains feeble. Given the continued weakness of total orders, growth prospects are likely to remain subdued.”