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GB: CBI Industrial Trends
| Actual | Previous | |
| Orders Balance | -27% | -28% |
Highlights
The latest industrial survey points to a manufacturing sector transitioning from contraction toward stabilisation, but not recovery. Total order books remained in negative territory but slightly above previous months decline (minus 28 percent) at minus 27 percent, while output declined sharply (minus 23 percent), with weakness spread across most sub-sectors, indicating broad-based industrial softness rather than isolated disruption.
However, forward-looking indicators suggest a turning point rather than continued deterioration. Expectations of flat output in the next quarterafter nearly a year of negative outlooksimply that firms see the downturn bottoming out, even if growth remains elusive.
The most critical constraint is demand fragility. Order books remain significantly below normal, highlighting a weak pipeline that limits production recovery. While export orders have improved, they remain insufficient to offset domestic and global demand uncertainty.
On the cost side, easing selling price expectations signal waning inflationary pressure, which could support margins and demand. Yet, elevated energy costsdriven by geopolitical tensionscontinue to pose structural cost risks, particularly for energy-intensive industries.
Inventory levels near historical norms suggest firms are not overproducing, reflecting cautious production strategies aligned with weak demand.
Overall, the sector is in a holding pattern as contraction is slowing, but recovery depends on stronger demand, reduced energy costs, and credible policy support to improve industrial competitiveness.
Definition
The Confederation of British Industry (CBI) produces a monthly survey (and a more detailed quarterly report) analysing the performance of UK manufacturing industry. This is the UK's longest running qualitative business tendency survey. Questions relate to domestic and export orders, stocks, price and output expectations with the main market focus being the domestic orders balance. The survey is seen as a loose leading indicator of the official industrial production data.
Description
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.
Frequency
Monthly and quarterly