Manufacturers optimistic on orders and output

| August 23, 2011
Manufacturers optimistic on orders and output

UK manufacturers are reporting healthy order books and expectations for output growth remain above their long-run average, despite being less strong than earlier this year.

New research from the Confederation of British Industry (CBI) also indicates that pricing pressures have eased following strong inflation during the first six months of 2011.

Expectations for growth in factory output have picked up a little, with 31% of firms surveyed predicting that production will rise in the next three months, and a balance of +14% of firms reported stock levels to be more than adequate, with the proportion in line with the long-term average.

However, on the downside, the CBI’s head of fiscal policy, Richard Woolhouse, says the risks to manufacturing activity and business confidence are on the increase because of market volatility and a worldwide reassessment of growth expectations.

According to Mr Woolhouse, concerns around growth in the US and the Euro area present particular challenges to the UK’s manufacturing recovery.

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