CBI: UK Manufacturing Order Books Expand in August

--Total Order Book Balance At 13 in August From July's 10 

By David Robinson

     LONDON (MNI) - UK manufacturing order books increased in August but did not

reach their June highs, while inflation expectations reaccelerated, the latest

CBI Industrial Trends survey found.

     The total order book balance rose to 13 in August from 10 in July and down

from 16 in June. Export order books rose to 11 in August from 2 the previous

month and 13 in June, with all the readings well above long-run averages. The

survey adds to the evidence showing an expanding manufacturing sector. 

     The output volume balance in August was 30, just below the 31 seen in July

and sharply up on 15 recorded in June. The average prices balance for the next

three months rose to 19 from 9 in July, but still the 23 reading in both May and

June.

     "There are further signs that exporters are feeling the benefit from the

lower pound in this month's figures, and output growth is expected to power on

over the coming quarter. But after a brief pause last month, expectations for

selling prices have rebounded, indicating that the squeeze on consumers is set

to persist," Anna Leach, CBI Head of Economic Intelligence, said. 

     The July purchasing managers indices showed the manufacturing sector

performing strongly, with a 55.1 headline reading, but the construction sector

struggled, posting its weakest performance since August last year and services

growth was subdued, with a 53.8 reading.

     The CBI survey suggests manufacturing could lead the way again in August.

--MNI London Bureau; tel: +44 203-586-2223; email: david.robinson@marketnews.com

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