A gauge of orders increased to minus 18 from minus 20 in April, the London-based business lobby said in a report published today. The median of 13 forecasts in a Bloomberg News survey was for a reading of minus 12 this month. A measure of exports fell to minus 22, the lowest since January, from minus 17.
Today’s figures highlight the fragility of Britain’s economy, a day after Chancellor of the Exchequer George Osborne said that while the U.K is healing, it still needs to “secure the recovery.” With the euro area, Britain’s biggest trading partner, struggling to emerge from recession, demand for U.K. goods has dropped, while austerity at home is curbing domestic spending.
“Manufacturers are treading water with domestic and export orders stagnant,” said Stephen Gifford, CBI Director of Economics. “While an expected improvement in conditions at home and abroad should lead to better prospects for manufacturers, the business climate still remains quite fragile.”
The CBI’s measure of expected average selling prices for the next three months slipped 1 point to 3 this month, the lowest since September 2012, while a measure of manufacturers’ output expectations for the next quarter declined to 10, the lowest since February, from 18 in May.
The CBI conducted the survey of 401 manufacturers between between May 22 and the June 12.
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