UK manufacturers see lowest inflation since Feb 2021 – CBI

Published On : 06/21/2023

LONDON (Reuters) – British manufacturers expect to raise prices by the smallest amount since February 2021 over the next three months although price increases will still be much faster than their long-run average, a survey showed on Wednesday.

The Confederation of British Industry (CBI) said its monthly index of manufacturers’ average selling price expectations slowed to +19 in June from +21 in May, its lowest in more than two years but well above its long-run average of +7.

Data published earlier on Wednesday showed Britain’s consumer price inflation unexpectedly remained at 8.7% in May, defying forecasts for a fall, but annual increases in the prices paid and charged by factories slowed.

The CBI’s monthly order book balance rose to a six-month high of -15 from -17 in May and were back close to their average levels, but the export order balance fell again to -29 from -26, the weakest since February 2021.

CBI deputy chief economist Anna Leach said manufacturing activity was likely to have shrunk a little during the second quarter due to weak demand.

“Total order books have improved a touch in recent months, but they remain fairly soft. And although output expectations have turned positive again, growth is expected to be quite weak in the three months to September,” Leach said.

The CBI’s measure of output over the next three months improved to +4 from -5.

The CBI survey was based on responses from 233 manufacturers between May 25 and June 13.

(Reporting by William Schomberg; editing by David Milliken)

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