reported a deterioration in both their total and export order books in August,
while expectations for output growth have flattened, the CBI, Britain's
principal business lobbying group, said today. Meanwhile, the Office for
National Statistics reported that borrowing
to cover the deficit between spending and revenue was £600m in July.
The ONS said [pdf]
that there was a surplus of £2.8bn in the same month a year earlier.
The Treasury blamed disappointing corporation tax
receipts for the July deficit while analysts suggest the government may have to
borrow about £30bn more than last year, when official forecasts had forecast
borrowing would fall this year.
The Office for Budget Responsibility, the
official UK economic forecaster, commented that there was still "significant
uncertainty" about the outlook for borrowing this year.
In the first four months into the financial year,
the government has borrowed £44.9bn, £9.3bn higher than the same period in 2011.
The total excludes items such as a one-off gain in April from a transfer
of Royal Mail pension assets to the public sector.
The CBI said that of the 456
manufacturers responding to the latest monthly Industrial Trends Survey, 15%
reported that order books were above normal, while 36% stated that order levels
were below normal. The balance of -21% represents the lowest return since the
end of last year (December -23%).
orders have weakened with manufacturers reporting a balance of -17%. While still
above the long-run average of -21%, this is the lowest figure reported since
January 2012 (-26%).
manufacturers’ output growth over the course of the next three months have also
softened. Output is expected to be flat over the next three months (0%),
following two previous surveys in which manufacturers expected output to
increase (June +7%, July +11%).
Output prices are
also expected to be flat over the coming quarter for the third-consecutive
month, with a balance of +1%.
Stock levels are
below average, with a balance of +9% saying stocks are at least adequate to meet
demand, the lowest figure since June 2011 (+3%).
Leach, CBI head of Economic Analysis, said: “Overall demand
for manufactured goods has eased back this month, led by a weakening in the
consumer goods sector following a strong July figure. This sector also
contributed to the weakening in output expectations for the next three months,
alongside investment goods.
environment for UK manufacturers remains challenging, with domestic demand
relatively muted and the ongoing Eurozone crisis now seeming to drag on broader
global economic momentum.”
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