CBI Industrial Trends Survey, October 2014: The latest results from the CBI Trends Survey shows an easing in the rate of growth in manufacturing output and total new orders also fell back to the lowest growth rate for a year. Although there was an easing in the rate of expansion in domestic orders, the main driver of the slower overall growth was the first decline in export orders for 18 months. This appears to be linked to reports of a loss of competitiveness - which in turn is probably due to the strength of Sterling - but concern about political and economic conditions are also above “normal”.
This is one of the CBI’s longer surveys, so we get information about other interesting indicators. Capacity constraints eased over the past three months with the share of rims operating below capacity rising to over 50% for the first time in 5 quarters; the overall capacity utilisation measure fell to 81.7, but with the exception of the very high figure in July (84.4) this is the strongest figure since April 2012.
However, despite this, the plant & machinery investment intentions indicator was broadly the same as in July and remains firmly above average.
You can download the CBI’s Press Release from their web-site at http://www.cbi.org.uk/business-issues/economic-intelligence/economic-int... or request it from MTA.
European Investment and Profitability, 2nd Quarter 2014: Eurostat reports that the Business Investment Rate (the ratio of gross fixed capital formation to gross value added) for the euro-zone was 21.6%, the same as in the 1st period of the year, but slightly lower than a year earlier when it was 21.8%; for the EU28 as a whole, the investment rate in the 2nd quarter of 2014 was 21.9%, the same as in both the 1st quarter of 2014 and the 2nd period of 2013.
The same report shows the Business Profit Share (the ratio of gross operating surplus divided by gross value added) for the euro-zone was 38.4%, down from the 38.7% recorded for the 1st quarter and lower than in the same period of 2013 (39.0%). For the EU28 as a whole, the profit share was 38.2% - this is neatly between the 38.1% recorded in the 1st period of 2014 and the figure of 38.3% in the 2nd quarter of 2013.
You can get the Eurostat News Release from their web-site at http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/ or request it from MTA.
European Business Climate Indicator, October 2014: The European Commission compiles an index of Economic Sentiment based on a range of surveys from across the member states - the UK input for manufacturing is the CBI Industrial Trends Survey highlighted above. The overall indicator picked up in October for both the euro-zone (by 0.8 points compared to September to 100.7) and for the EU28 as a whole (by 0.5 points to 104.0). There was a small rise in industry confidence as respondents were more optimistic about the expected level of production and the current level of order books.
The quarterly surveys (January, April, July and October) have more detail and, in particular, they include data on capacity utilisation rates; The level for the euro-zone ticked up marginally to 80.0 (79.9 in the July survey), while the rate for the EU28 as a whole was unchanged at 80.2.
You can get the European Commission’s report from their web-site at http://ec.europa.eu/economy_finance/db_indicators/surveys/index_en.htm (scroll down and click on the reports dated 30 October) or request it from MTA.