12/19/2023 | Press release | Distributed by Public on 12/19/2023 05:05
Manufacturers reported that output volumes were stable during the final three months of the year - the first time output hasn't fallen since the quarter to July 2023, according to the CBI's latest Industrial Trends Survey (ITS). Manufacturers expect output to rise marginally in the first three months of 2024.
Both total and export order books were reported as below normal in December, though they improved relative to the near-three year lows reached last month. Against a backdrop of subdued demand and improved supply conditions, expectations for future selling price inflation have fallen sharply over the course of 2023 and were in line with their long-run average in December.
The survey, based on the responses of 237 manufacturers, found:
Anna Leach, CBI Deputy Chief Economist, said:
"UK manufacturers appear to have ended the year on a stable footing. with December's results only the second set this year to not show falling activity. Selling price expectations are the weakest they have been in two years, reflecting ongoing improvements in supply conditions and soft demand.
"The environment for UK manufacturing is likely to remain challenging, with global growth set to remain weak in the year ahead. High interest rates will continue to weigh on household spending, while adding to business costs. And sticky domestic inflation and strong wage growth suggest cuts to UK interest rates are still some way off.
"With an election looming, the broader policy environment is set to remain uncertain. Manufacturers welcomed the decision in the Autumn Statement to make full expensing permanent, which should provide a bit more impetus for investment plans. But tackling ongoing labour and skill shortages is still a top priority, starting with long-overdue reform of the Apprenticeship Levy."