GB: CBI Industrial Trends Survey

Thu Feb 19 05:00:00 CST 2015

Consensus Actual Previous
Level 6 10 4

The goods producing sector looks to have enjoyed a good February according to the latest CBI Trends survey. In addition to a stronger increase in new business, both past and expected output posted solid gains versus January and output prices are also seen accelerating over coming months.

At a higher than expected 10 percent, the orders balance was up 6 percentage points versus its level at the start of the year to register its best reading since August 2014. Within this there was also a much needed improvement in exports (minus 8 percent after minus 20 percent). At the same time, past output growth accelerated (up 7 percentage points to 17 percent) to stand some 14 percentage points above its long-run average while expected production (25 percent after 13 percent) saw its strongest mark since last September. Stocks (5 percent) were unchanged but expected factory gate prices (8 percent after minus 6 percent) climbed quite sharply, albeit from January's 10-year low, despite the weakness of oil costs.

Today's results are generally quite upbeat and suggest that the February manufacturing PMI will see some bounce from its January reading (53.0). Following yesterday's positive labour market report the signs are that first quarter UK GDP growth could well surprise on the upside.

CBI conducts a monthly survey of senior manufacturing executives on trends in output, prices, exports, and costs. The CBI's quarterly Industrial Trends Survey collects data on topics like current business confidence, capacity utilization and investment intentions.

Started in 1958, this is the UK's longest-running private sector qualitative business tendency survey. The survey is used by policy makers along with those in the business community, academics and top analysts in financial markets. One of its key strengths is that it is released within ten days and prior to official statistics and includes data not covered by official sources. It is never revised. The data are also used by the European Commission's harmonized business survey of EU countries.

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