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ECONOMIC DATA THIS WEEK

Bank of England’s Agents’ Summary of Business Conditions, 2nd Quarter 2017:  The latest report from the Bank of England’s Agents reflects a pick-up in manufacturing output;  in the domestic market, both the aerospace and automotive industries were highlighted as being among those with the fastest growth, as well as a note that “a very modest recovery in output for those in the oil & gas supply chain was in train”.

They go on to point out that the weakness of sterling and a stronger world economy has led to a marked increase in export volumes, with the automotive industry again getting a mention in this context.

Investment intentions are noted as having strengthened a little further with investment in technology to drive efficiencies prevalent across all sectors and some manufacturing exporters are planning to expand capacity on the back of improving demand.  However, they also say that heightened uncertainty remains a drag on some businesses’ willingness to invest.

Capacity utilisation is reported to be broadly unchanged, although with a slight tightening for manufacturing;  although overall it is not constraining growth, companies who are exporters, in the automotive supply chain and producers of construction-related products continue to report the most material constraints.

You can download this report, which also includes special notes on the UK car market and tightness in the UK labour market, from the Bank’s web-site at www.bankofengland.co.uk/publications/Pages/agentssummary/default.aspx or request it from MTA.

CBI Industrial Trends Survey, June 2017:  As with the Bank of England’s Agents’ report, the CBI survey also showed an improvement in demand for UK manufactured goods, in this case over the 3 months to June, with total and export order books reaching their highest level for 29 and 22 years respectively.  This was broadly spread with total order books growing in 13 of the 17 sub-sectors covered by the CBI survey.

Output growth also remained robust, although the pace of expansion has eased slightly since the start of the year, with the Chemicals and Mechanical Engineering sub-sectors seeing sharp slowdowns.  The latter is disappointing as there had been some long overdue recovery here and it remains to be seen how this comes out in the manufacturing output data over the Summer.

You can download the press release of the CBI survey from their web-site at www.cbi.org.uk/news (it was published on 22nd June) or you can request it along with a brief summary of the survey results from MTA.

European Commission Economic Sentiment Indicator, June 2017:  The European Commission (EC) draws on business surveys from across Europe including, for the UK, the CBI survey that we covered above, to arrive at its Economic Sentiment Indicator (ESI).  The latest data shows a significant improvement for both the Euro-zone and the EU28, which more than outweighed the dip that was seen in May and took the level of the ESI to its highest point since August 2007.

Within the overall ESI, industrial confidence in the Euro-zone was stronger, driven by a more optimistic assessment of the current level of order books and a healthier level of stocks of finished products, while output expectations were unchanged.  Although not included in the calculation of “confidence”, there was also a marked improvement in the Euro-zone for both the assessment of past production and export order books.  The EU28 trend for industrial confidence was in-line with that for the Euro-zone.

You can download the European Commission’s report from their web-site at https://ec.europa.eu/info/business-economy-euro/indicators-statistics/economic-databases/business-and-consumer-surveys/latest-business-and-consumer-surveys_en or you can request it from MTA.

CECIMO Economic & Statistical Toolbox, March-April 2017:  The latest edition of the slightly renamed CECIMO round-up of data has been published recently.  As usual, it includes coverage of data series such as interest rates, industrial production, industrial employment and the OECD Business Confidence Indicator as well as the CECIMO MT-IX series - this is a tracker of share prices for publicly quoted machine tool manufacturing companies around the world.

You can download the CECIMO Toolbox from their web-site at www.cecimo.eu or request a copy from MTA.