UK Factory Output Declined for Fifth Straight Quarter
A recent report by the CBI indicates that the manufacturing sector in Britain continued to exhibit signs of weakness despite Boris Johnson’s re-election that helped improve the sentiment in other sectors of the economy recently. Factory gate output declined for the fifth consecutive quarter, but the pace slowed down during January.
Among 320 firms that participated in the survey, only five out of 17 sub-sectors in manufacturing experienced a growth in output. The decline was driven by a reduction in volume of production in food, drink and tobacco businesses.
On the positive side, total and export order books reported a slight improvement during January, rising to the highest levels seen in six months. In addition, the outlook among manufacturers has also improved, with businesses expecting output to recover in the coming three months.
However, reigning uncertainties surrounding Brexit are likely to keep the manufacturing sector in Britain under pressure until Britain and the EU finalize their trade deal. Some momentary hope for the sector can be forthcoming in the upcoming budget due to be presented on March 11, in case the government announces measures to support the sector.
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