MNI: UK Manufacturing Output Fails to Bounce Back in Apr : CBI

--Apr Total Order Book Balance +4% Vs +4% Mar

By Jai Lakhani

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

were fairly flat in April, a survey from the Confederation of British Industry

showed. The survey also showed that optimism regarding business situation over

the past three months fell sharply in April to -4% from 13% in January. 

     The April total order book balance remained at 4% in March, with the export

order balance moving down a touch from 10% to 9% and output volume balances for

the past three months dipping to 13% from 16%. 

     These data suggest that after further solid expansion in the first quarter,

the second quarter is fairly pale in comparison. However, it is worth noting

that the expected volume of output for the next three months is up to 21% from

March's figure of 13%, suggesting firms are anticipating a pick-up. 

     --OUTPUT SLOWED

     "Manufacturing output slowed in the three months to April, but firms expect

a pick up over the next quarter. Domestic order stagnated, seeing no growth for

the first time in two years, but export orders growth accelerated to its fastest

since 1995," Anna Leach, CBI Head of Economic Intelligence, said.

     The survey showed pipeline inflation pressures continuing to ease, although

still elevated. Unit cost growth slowed for the second quarter running, and is

expected to ease more drastically over the next three months.  

     A net 18% of manufacturers expected average prices to rise over the next

three months, unchanged from March which in turn was down from a net 25% in

February and 40% in January and back in line with the readings in September and

October last year. The long run average prices balance is just 2%.

     Manufacturers have reduced the built up stock levels witnessed in March,

with the net 12% balance for above adequate stocks below the the long run

average of 13%.

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

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

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