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| Factory orders fall due to rising import costs and Brexit uncertainty | Factory orders fall due to rising import costs and Brexit uncertainty |
| (4 months later) | |
| The CBI said its monthly survey of manufacturers revealed a slowdown in orders driven by the food and drink sector | |
| Phillip Inman | |
| Fri 22 Sep 2017 23.48 BST | |
| First published on Fri 22 Sep 2017 18.40 BST | |
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| British factory orders grew in September at their weakest rate since April as rising import costs and uncertainty surrounding Brexit negotiations dented business confidence. | British factory orders grew in September at their weakest rate since April as rising import costs and uncertainty surrounding Brexit negotiations dented business confidence. |
| The CBI said its monthly survey of manufacturers revealed a slowdown in orders that dragged back its measure for new contracts to +7 from +13 in August. | The CBI said its monthly survey of manufacturers revealed a slowdown in orders that dragged back its measure for new contracts to +7 from +13 in August. |
| The sector also suffered a slowdown in output growth over the past three months driven by the food and drink sector, which is among the industries suffering the most from rising import prices. | The sector also suffered a slowdown in output growth over the past three months driven by the food and drink sector, which is among the industries suffering the most from rising import prices. |
| CBI economist Anna Leach said the sector was still in rude health and likely to continue growing at above the historic trend for some time. | CBI economist Anna Leach said the sector was still in rude health and likely to continue growing at above the historic trend for some time. |
| “Manufacturers continue to report solid growth in output, while total order books and export order books are holding firm,” she said. | “Manufacturers continue to report solid growth in output, while total order books and export order books are holding firm,” she said. |
| “Expectations for selling prices were largely in line with the previous month, but price pressures do appear to have moderated somewhat since earlier in the year.” | “Expectations for selling prices were largely in line with the previous month, but price pressures do appear to have moderated somewhat since earlier in the year.” |
| Britain’s economy has slowed this year as the effect of a weaker pound pushed up inflation and weakened consumer demand. | Britain’s economy has slowed this year as the effect of a weaker pound pushed up inflation and weakened consumer demand. |
| The Bank of England has nevertheless said it is likely to raise interest rates at its next meeting on 2 November in the expectation that full employment will raise wage rates and keep inflation above its 2% target next year. | The Bank of England has nevertheless said it is likely to raise interest rates at its next meeting on 2 November in the expectation that full employment will raise wage rates and keep inflation above its 2% target next year. |
| Bank chiefs have forecast that stronger exports will help offset weaker business investment and uncertain consumer demand. | Bank chiefs have forecast that stronger exports will help offset weaker business investment and uncertain consumer demand. |
| The CBI survey painted a rosier picture of manufacturing output this year than gloomy official figures from the Office for National Statistics, which have shown the sector contracting for most of the first half. | The CBI survey painted a rosier picture of manufacturing output this year than gloomy official figures from the Office for National Statistics, which have shown the sector contracting for most of the first half. |
| Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “The CBI’s total orders balance fell to its lowest level since April, but it still is consistent on past form with year-over-year growth in manufacturing output of about 4%. | Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “The CBI’s total orders balance fell to its lowest level since April, but it still is consistent on past form with year-over-year growth in manufacturing output of about 4%. |
| “We doubt that manufacturing is growing that quickly – the relationship between the survey and official data has been poor lately – but it’s clear that the sector is is enjoying a rare good spell.” | “We doubt that manufacturing is growing that quickly – the relationship between the survey and official data has been poor lately – but it’s clear that the sector is is enjoying a rare good spell.” |
| The closely watched Markit/Cips UK manufacturing PMI barometer of factory sentiment showed activity jumped to 56.9 last month from 55.3 in July, the second-highest level in more than three years, helped by the weak value of the pound. | The closely watched Markit/Cips UK manufacturing PMI barometer of factory sentiment showed activity jumped to 56.9 last month from 55.3 in July, the second-highest level in more than three years, helped by the weak value of the pound. |
| Manufacturing sector | |
| Food & drink industry | |
| Confederation of British Industry (CBI) | |
| news | |
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