Drop in factory orders now less severe than long run average

Ben Southwood
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ORDERS on manufacturers’ books have begun to show improved signs of life this month, according to a survey out yesterday.

A net balance of 12 percentage points more firms told the Confederation of British Industry (CBI) their order books were below normal in December, than those that said their books were more full than normal.

But this minus 12 figure was a significant improvement on November’s minus 21, and it is comfortably above the long run average of minus 17, putting a more positive gloss on the data.

And the index for output over the coming three months also improved – from minus nine in November to zero in December, suggesting firms expect output to stay about where it is now.

IHS Global Insight’s Howard Archer said the improvement in the survey data provided some reason for hope amongst manufacturers. “A significantly improved December CBI industrial trends survey offers some grounds for optimism for manufacturers going into 2013 after they suffered a pretty torrid end to a largely difficult 2012,” Archer said.

But he predicted that international conditions would continue to prove difficult.