–Adds Detail To Version Transmitted At 1028 GMT
–UK CBI Monthly Oct Total Orders -28 Vs -17 In Sep
–UK CBI Oct Output Volume 18 vs 12 in Sep
–UK CBI Oct Trends: Oct Average Prices 6 vs 15 in Sep
–UK CBI Oct Trends: Oct Export Orders -21 vs -5 in Sep
–UK CBI Expected Output Next 3m Highest Since March 2008
–UK CBI Quarterly Trends: Oct Business Optimism 2% vs 10% Jul
–UK CBI Oct Quarterly Volume Of Expected Output 18% vs 6% Jul

LONDON (MNI) – The manufacturing sector expects a strong rise in
output over the next three months, driven by predictions of a stronger
increase in export orders, suggesting manufacturing growth could be
stronger in Q4 than Q3, according to the CBI’s quarterly industrial
trends survey.

Of the 420 manufacturers surveyed in the quarterly survey, 32%
expect an increase in output volumes in the next three months and 14% a
fall, giving a balance of 18%. This follows a balance of 9% reporting a
rise in output in the past three months.

The predicted faster output growth is primarily driven by
expectations of an acceleration in export growth in the coming quarter,
with a balance of 15% expecting volumes of export orders to rise,
compared to a net 6% reporting a rise in export orders in the past three
months. Domestic order growth is set to be more subdued, with a balance
of 2% expecting an increase.

Looking ahead to the next quarter, the volume of total new orders
is expected to grow at a steady pace, with a net 12% forecasting a rise,
similar to the 11% recorded for the past three months.

The CBI said predictions of strong output growth come after a
slightly softer patch over the past three months as the temporary boost
to second quarter output from the turn in the stock cycle faded stock
building will have less of an impact going forward.

In the coming quarter, 14% expect stocks of finished goods to
increase, while 18% said they would fall, giving a balance of -4%
compared to a balance of 3% for the three months to October.

Overall business sentiment was less positive than three months
ago. The optimism balance regarding the business situation fell to a
net 2% from 10% in the July survey.

Oct Monthly Survey Shows Orders Decline

Along with its quarterly survey the CBI also published the October
monthly survey.

This showed the October total orders balance falling to -28% from
-17% in September and export orders declining to -21% from -5%.

Output, however, picked up with the output volume balance rising to
18% from September’s 12%.

While markets appeared to take their cue from the softer monthly
data, with sterling falling after the data release, the CBI put a
positive spin on the numbers.

“The recovery in the manufacturing sector is well grounded and
looks set to continue, despite a soft patch last quarter, when
production growth slowed as firms had expected,” Ian McCafferty, the
CBI’s Chief Economic Adviser, said.

-London newsroom: +4420 7862 7491; email: wwilkes@marketnews.com

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