British manufacturing activity showed modest signs of easing in September, though firms continue to face significant hurdles, according to a Confederation of British Industry (CBI) report released Tuesday.
The CBI’s monthly new orders balance for manufacturing rose to -27 in September from -33 in August, indicating that orders are still falling, but at a slower rate than in the previous month. Output measures over the past three months also showed some improvement, though they remained within contraction territory. Looking ahead, the forecast for the next quarter dipped slightly, with the indicator slipping to -14 from -13 in August.
“Businesses across the board are looking ahead to the November Budget with hope that it delivers meaningful action to ease cost and regulatory pressures,” said Ben Jones, lead economist at the CBI.
He added, “Without that clear policy direction, confidence will continue to ebb and firms will find it increasingly difficult to invest, hire and grow.”
The survey highlighted ongoing challenges for manufacturers, including uncertainty surrounding the upcoming government budget, broader economic conditions, elevated energy costs, and difficulties in attracting skilled labor.
Export orders showed a slight improvement from August, with the gauge rising to -32, though it remains well below the long-term average of -19. On a brighter note, expectations for price increases over the next three months fell to their lowest level since October 2024, suggesting that inflationary pressures in the sector may be easing.
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