UK manufacturers experienced a sharper decline in output volumes in the three months to February than in the quarter to January, according to the latest Industrial Trends Survey (ITS) from the Confederation of British Industry (CBI). Despite this downturn, there is an anticipation of a marginal increase in production in the upcoming quarter to May.

The survey, gathering insights from 344 manufacturing firms, indicated a balance of minus 19 per cent in output volumes for the three months to February, down from minus 10 per cent in the previous quarter. However, manufacturers are optimistic, expecting a slight improvement in output (4 per cent) in the quarter to May.

Order books in February, both total and export, were reported to be below ‘normal’ but showed signs of improvement from the previous month. The total order books improved to a balance of minus 20 per cent from minus 30 per cent, though still below the long-run average of minus 13 per cent. Export orders also saw a positive shift, reaching a balance of minus 14 per cent from minus 27 per cent, surpassing the long-run average of minus 18 per cent, as per the survey.

Furthermore, expectations for future selling price inflation witnessed an uptick in February, recording the strongest level since July 2023 with a balance of 17 per cent, up from 9 per cent in January. This increase indicates manufacturers' anticipation of higher selling prices, although still significantly below the peak of 80 per cent seen in March 2022.

Stock levels of finished goods were reported to be more than ‘adequate’ in February, with the balance adjusting to 11 per cent from 18 per cent in January, suggesting a slight easing in stockpiling pressures.

Fibre2Fashion News Desk (DP)

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