The CBI Industrial Trends Survey (ITS) published this week showed another reduction in manufacturing output volumes that was at a similarly steep pace to that recorded in the 3 months to May. Total order books were also at a low level that was slightly weaker than the already sharp decline recorded in the previous survey.
It is worth noting that although dated “June”, the data collection period for this survey ran from 27th May to 13th June, so the results really cover the 3-month periods from March to May (past) and June to August (future). A similar principle applies to the other months mentioned in this report.
The negative balance for manufacturing output volumes over the past 3 months were marginally, but not significantly, less weak than in the period to May but, with output decreasing in 14 of the 17 subsectors, the picture remains poor. It is also of concern for us that although chemicals was the weakest of the sub-sectors, this was followed by metal products and mechanical engineering (sometimes called machinery) which are two of our key markets.
Although the pace of decline in the volume of output is expected to slow significantly in the coming 3 months, there were similar expectations for the current period which have clearly not been met.
Total order books were reported to be “below normal” and at a slightly greater level than in the May survey. Indeed, with the exception of more modest negative balances in August and November 2024, it has been around this level for the past 12 months. Export order books were slightly less negative than in May but remain significantly below their long-run average.
Stocks of finished goods were regarded as “more than adequate” but the balance fell below its long-run average.
You can get the Press Release of the CBI ITS from their website at www.cbi.org.uk/media-centre (24 June) or request it from MTA (we can also provide a summary of the results).