MNI: UK Manufacturing Orders Hit 4 Month Low In September: CBI

--September CBI Total Order Book Balance -1% Vs +7% Aug

By Jai Lakhani

     LONDON (MNI) - UK manufacturing order books and output volumes eased in

September versus the previous month, but both remained above their long-run

averages, a survey for the Confederation of British Industry released Tuesday

showed. 

     The September total order book balance fell to -1%, down eight points from

August, but above the long-term average of -13%. This signalled a slowing in

growth relative to a robust showing in August. 

     A sub-component of the headline index, the export order balance, changed

after three months at 9%, dropping to +5, illustrating some of the overall

decline was attributable to falls in foreign demand. 

     Sector analysis pointed to motor vehicles and transport equipment dragging

growth and offsetting growth in 10 out of 17 sub-sectors, especially mechanical

engineering, food, drink and tobacco, plastic products, and mental products

sectors. 

     The volume of orders in the three months to August moderated to 11%, down

from 21% in August, implying that manufacturers gave back some of the strong

form displayed in Q2 and early Q3. 

     Firms were relatively optimistic about the coming three months, with the

expected volume of output measure dropping only one point to 19% --

significantly above the long term average of 9%.

     --BREXIT UNCERTAINTY

     "While manufacturing order books remain strong and output is still growing,

Brexit uncertainty continues to cloud the outlook. Heightened fears of a "no

deal" Brexit scenario have prompted some firms to move publicly from contingency

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

     The final six months of negotiations will undoubtedly tell if manufacturing

can continue its resilience. "... However, the continued uncertainty surrounding

the final six months of Brexit negotiations presents a real risk to the

continuation of this strong momentum," Tom Crotty, Group Director, INEOS, and

Chair of the CBI Manufacturing Council said. 

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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