23rd January 2008
Demand holds firm, says CBI
Analysts looking at yesterday's Confederation of British Industry (CBI) report into manufacturing are concluding that the sector is showing greater than expected resilience in the face of economic pessimism.
The CBI's quarterly Industrial Trends survey was conducted between 13 December and 9 January, with responses from 482 manufacturing firms.
It shows that, during the three months to January, growth in firms' orders held up, with exports in particular remaining strong. This was despite continuing rises in the cost of food and energy.
28% of firms said their total new orders had increased in the period, while 17% reported a decrease. The 'positive balance' continues a trend from the previous three reports and defies expectations.
Businesses expect that, in the coming months, their domestic prices will increase at the fastest rate for 13 years. Total order book levels looked even healthier, with the highest positive balance of firms saying their orders were "above normal" in January since April 1995.
And, in apparent contradiction of firms' own stated pessimism about the economic future, spending plans for product and processes across the board are at their most positive since 1997.
Ian McCafferty, CBI Chief Economic Advisor, said: "Thankfully, the expected wobble in demand didn’t materialise in the last three months and orders for British-made goods have held up, particularly from abroad."
He concluded: "What we are seeing is part of a necessary rebalancing of the economy, in the face of slowing consumer spending. The dilemma over interest rates is to weigh the risks of a slowdown with the real and present pressure on prices."
The CBI's quarterly Industrial Trends survey was conducted between 13 December and 9 January, with responses from 482 manufacturing firms.
It shows that, during the three months to January, growth in firms' orders held up, with exports in particular remaining strong. This was despite continuing rises in the cost of food and energy.
28% of firms said their total new orders had increased in the period, while 17% reported a decrease. The 'positive balance' continues a trend from the previous three reports and defies expectations.
Businesses expect that, in the coming months, their domestic prices will increase at the fastest rate for 13 years. Total order book levels looked even healthier, with the highest positive balance of firms saying their orders were "above normal" in January since April 1995.
And, in apparent contradiction of firms' own stated pessimism about the economic future, spending plans for product and processes across the board are at their most positive since 1997.
Ian McCafferty, CBI Chief Economic Advisor, said: "Thankfully, the expected wobble in demand didn’t materialise in the last three months and orders for British-made goods have held up, particularly from abroad."
He concluded: "What we are seeing is part of a necessary rebalancing of the economy, in the face of slowing consumer spending. The dilemma over interest rates is to weigh the risks of a slowdown with the real and present pressure on prices."
- 6th January 2009 Interest rates 'set to fall to record low'
- 6th January 2009 Businesses urged to take financial "MOT"
- 5th January 2009 Businesses urged to make redundancies 'last resort'
Delicious
Digg
reddit
Facebook
StumbleUpon