UK factories see fastest output growth on record, price pressure growing – CBI
British manufacturers reported the strongest growth in output on record but also expect to raise their prices at the fastest pace in nearly 40 years, according to a survey which adds to signs of growing inflation pressures.
The Confederation of British Industry’s monthly index for industrial output growth over the past three months was the highest since the CBI records began in 1975 at +37, helped by the lifting of coronavirus restrictions.
The CBI’s orders balance – measuring the difference between the proportion of employers who say order levels are above or below normal – hit +19 in June from +17 in May, its highest since 1988.
Economists polled by Reuters had expected a reading of +18.
“Encouragingly, this performance is reflected in the majority of manufacturing sub-sectors and looks set to continue in the coming quarter,” Anna Leach, the CBI’s deputy chief economist, said.
“However, supply shortages continue to bite, and firms expect that to push through into prices in the months ahead.”
The survey’s price balance rose to +46 from +38 in May, the highest since 1982 and well above its average of +3.
Source: Reuters (Reporting by William Schomberg, editing by David Milliken)