Manufacturing output grew at its fastest pace in ten months over the quarter to May, but confidence fell further, according to a survey released on Thursday by the Confederation of British Industry.
The CBI’s total orders balance rose to +26 from +14 in April, coming in above consensus expectations of +11. The survey found that output still failed to keep pace with demand, however, as the volume of stocks of finished goods became less adequate compared with the previous month.
Meanwhile, confidence showed a further decline in the quarter to May, while investment plans for buildings and plant and machinery remained weak.
CBI deputy chief economist Anna Leach said: “Manufacturers have reported output growth and order books improving in May. But cost pressures remain acute and are pushing manufacturers to raise prices. Sentiment among manufacturers has fallen in recent months as the outlook has deteriorated following Russia’s invasion of Ukraine, and investment plans are being scaled back.
“Rising costs are hitting consumers and businesses alike, and the Government can and must take action now to support the economy through the challenging months ahead. Putting pounds in the pockets of people already struggling should not be delayed, and must be coupled with action to support firms’ cashflow and to stimulate investment.”