Weaker UK orders for factories in July

City A.M. Reporter
BRITISH manufacturing orders have fallen at their fastest rate since January 1992 this month, a survey showed yesterday, disappointing hopes for a speedy recovery in the sector.<br /><br />The Confederation of British Industry&rsquo;s (CBI) industrial trends survey showed the order book balance fell to -59 in July from -51 in June, below analysts&rsquo; expectations of a reading of -45.<br /><br />&ldquo;The survey heightens suspicion that sustainable growth in the sector could remain elusive for some considerable time to come,&rdquo; said economist Howard Archer at IHS Global Insight.<br /><br />The export orders balance improved slightly in July, up to -45 from -52 in June, but still indicated sharp declines. The CBI said it was disappointing that sterling&rsquo;s 20 per cent fall over the past two years had not had more of an impact.<br /><br />&ldquo;The further sharp decline in export orders is of particular concern as we are not seeing much of a boost from the relative weakness of sterling,&rdquo; said Ian McCafferty, chief economic adviser to the CBI. &ldquo;There are also further indications that the inventory cycle may not be turning as quickly as many had hoped,&rdquo; he added.<br /><br />The quarterly survey showed conditions had improved since earlier in the year but remained tough, particularly for small firms that were still finding it hard to access finance.<br /><br />The quarterly business situation balance improved to -16 in July, its least negative reading since October 2007, from -40 in April. <br /><br />The survey also showed exporters were still struggling to get finance.