U.k. CBI industrial trends survey’s output indicator eased in August
Source: FxWire Pro - Commentary / 21 Aug 2018 14:13:44 America/New_York
U.K.’s CBI Industrial Trends survey released today painted a comparatively positive picture of the latest developments in the U.K. manufacturing sector. While the survey’s output indicator dropped to 21 percent from 27 percent in August, it continued to be strongly above its long-term average, and its three-month average was at the highest level since the beginning of the year.
Manufacturers anticipate that similarly strong growth would be maintained in the months ahead and their positivity appears to have been underpinned by incoming new orders – the relevant indicator continued to be in line with its elevated average for this year, noted Daiwa Capital Market Research in a report.
Moreover, the survey’s export orders index was slightly altered, continuing to hint at strong overseas demand, which seems to be driven by softness in sterling. However, the CBI underlined that risks to the outlook continue to be high in light of the likelihood of a ‘no-deal’ Brexit and weakened domestic demand. Nevertheless, the official data in the recent months have disappointed compared to this survey’s results. Manufacturing output dropped in the first quarter and the second quarter, and the annual rate fell to 1.4 percent year-on-year, the joint weakest since late 2016.
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