We are pleased to announce the release of the usual Spring update to our Forecasts; this year, we have of course, updated the cutting tool forecast that we introduced last Autumn alongside our long running machine tool forecast. Also just published is the Spring edition of the Global Machine Tool Forecast that we subscribe to via CECIMO. MTA members can download any or all of the documents from the web-site at www.mta.org.uk/members-area/mta-forecast-documents.
In general, our forecasts for growth in the UK market in 2015 have been downgraded slightly compared to last autumn. In the case of machine tools, this is mainly because 2014 ended more strongly than we had expected, so although the 2015 total is slightly higher, the growth rate is now +3.3% compared to 2014 (we had +5.2% last autumn); for cutting tools, the 2015 forecast is now for growth of +2.0% (it was +4.5%), mainly as a result of some weakness in the output data for the Machinery sector in the early part of 2015.
The main risks to the forecast have not changed much; the consequences of a Greek exit from the euro tops the list of downside risks, although there is also a risk from the upcoming General Election - we are already seeing some short term uncertainty in our surveys and, depending on the result, this could continue after 7th May. The upside risk of a stronger US recovery provides some balance in the risks which would also be helped by the current exchange rate trends between Sterling and the US Dollar.
For the Global Forecast, the outlook for machine tool demand in 2015 has also been downgraded. Despite the boost to many economies from lower oil prices, there are reasons to remain cautious about a number of countries and the forecasts for both industrial production and investment have been reduced from where they were six months ago - hence the lower rate of growth for the machine tool market.
We will give a more in depth review of the forecast update in a couple of weeks’ time with the next edition of the MTA Economic Report, but if you would like to chat through the updated predictions, please give Geoff Noon (0207 298 6400) a call.