MNI: UK Data Forecasts - September CBI Industrial Trends

By Jamie Satchithanantham

     LONDON (MNI) - Against the consensus expectation of a slight deterioration

in UK industrial output, the headline component of the August CBI Industrial

Trends Survey picked up 3 points to +13 and boosted the prospects of a return to

growth for the sector in Q3.

     Production was down 0.6% q/q Q2 and the last data from the CBI pointed

towards  a return to growth territory. The order balance component of the survey

is expected to hold onto much of July's rise in August, falling by just a

solitary point to +12.  

     Much of this projection by analysts will be based on the fact that survey

respondents were bullish about future prospects, with the output expectations

balance up 2 points to +30. 

     The pick up in manufacturing activity was not restricted to just the CBI

survey. An upturn was also picked up in the latest Markit manufacturing PMI,

which rose to a fourth-month high of 59.9 in August from 55.3. As as being a

four-month high, this was also the second highest outturn in the last three

years. All five components of the PMI rose, including Production which rose at

its steepest pace for seven months.      

     Despite this encouraging pattern emanating from the survey data, which

pictures a robust sector, holding up well, it still appears to be at odds with

the official data published by the ONS which depicts a more sluggish picture.

     On a three-month-on-three-month basis, official industrial production

output was up 0.3% in July with the manufacturing sub-component down 0.1%,

accounting for -0.07 percentage points of 3m/3m change in IOP.

------------------------------------------------

                                             Sep

                    CBI Industrial Trends Survey

                             Order Books Balance

                                               %

Date Out                                  22-Sep

Median                                      12.0

Forecast High                               14.0

Forecast Low                                 8.0

Standard Deviation                           2.8

Count                                          4

Prior                                       13.0

JP Morgan                                   14.0

Nomura                                      13.0

Pantheon                                     8.0

Standard Chartered                          10.0

--MNI London Bureau; +44 203-586-2226; email: jamie.satchithanantham@marketnews.com

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