MNI BRIEF: UK Manufacturing Sentiment Highest Since 1973: CBI

Optimism in the UK manufacturing sector rose at the fastest rate rate since 1973 as the outlook for demand conditions improved, data published Thursday by the CBI showed. "Phased reopening has lifted the mood among firms, notably driving orders, employment, and investment plans," said Rain Newton-Smith, CBI Chief Economist. However, the rapid pace of cost growth remains a concern and puts pressure on firm's margins, she added.

Total order books eased slightly to -8 in April, down from -5 seen in March, according to the CBI's latest Industrial Trends survey. Export order books improved to -18 in April, registering at their long-term average. Firms expect output to increase markedly in the next three months, but they also expect prices to increase substantially.

Anecdotal evidence suggests that investment plans were brought forward to take advantage of the government's recently announced super-deduction, the report noted. "Continuing to support firms while they get on a steadier footing as restrictions ease will be crucial to recovery," Newton-Smith added.