Cooling exports weigh on manufacturing data

The UK manufacturing sector has continued to expand at a solid pace, but new figures point to weaker growth in order books suggesting the boost from the weak pound may be fading.

Publishing its latest industrial trends survey yesterday, the CBI said a balance of 10 per cent of firms reported an increase in order books over the three months to February, down from 14 per cent previously, although still above the long-run average. Export order growth cooled markedly, with a balance of 10 per cent against 19 per cent in last month’s report.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “The further decline in the CBI’S total orders balance in February indicates that the support to growth in manufacturing output from sterling’s depreciation is beginning to fade.”

A balance of 24 per cent of firms reported a rise in overall output volume for the latest period, up from 21 per cent.