Growth in UK factory orders slightly moved down to a three month low in August amid robust export business, said the Confederation of British Industry (CBI) in a report on Tuesday (21).
CBI’s monthly factory orders balance declined to +7 from +11 in July, according to the data released.
Companies’ expectation for manufacturing output over the next three months, and anticipation of prices moved up to the highest mark since May, the report said.
“While we expect UK manufacturers to continue benefitting from healthy external demand and a lower sterling exchange rate, overall economic growth is expected to remain subdued, reflecting weak household income growth and investment being held back by ongoing Brexit uncertainty,” the CBI report highlighted.
“Manufacturing growth remains strong, supported by the lower level of sterling and strong global economy. But risks to the growth remain high in light of international trade tensions and the uncertainty caused by Brexit. Firms will be keen to see urgent progress on the withdrawal agreement to lock in transition, which is crucial to continuing frictionless trade as the UK leaves the EU,” said Anna Leach, Economist at CBI.
“Make no mistake, a ‘no deal’ scenario would be immensely damaging not just for UK manufacturers, but also the rest of the EU. So both sets of negotiators need to demonstrate flexibility and compromise to protect trade flows worth 600 billion euros each year, particularly against the backdrop of increasing protectionist rhetoric,” she pointed out.