A survey by the Confederation of British Industry (CBI) has shown an acceleration in manufacturing output, with 43 per cent of firms reporting an increase in output over the past three months, and 12 finding volume down, giving a balance of 31 per cent, the highest since January 1995.
The CBI surveyed 397 manufacturers, most whom said they were hiring more staff and were receiving a steady increase in export orders.
Rain Newton-Smith, CBI Chief Economist, said: “Output growth among UK manufacturers is the highest we’ve seen since the mid ‘90s, prompting the strongest hiring spree we’ve seen in the last three years. Cost pressures are easing and firms are upbeat about the outlook for export orders.
“It’s great to see the benefits from the decline in sterling for UK exporters feeding through. But the flipside is the broader hit to consumer spending power across the economy from stronger inflation, which is likely to have fuelled the slowdown in the economy in Q1 and is expected to pull down growth in Q2.”
18 per cent of firms said they were more optimistic about the general business situation than three months ago and 13 per cent were less optimistic, giving a balance of five per cent. Optimism about export prospects for the year ahead grew at a solid pace, around 13 per cent.