UK manufacturers see lowest inflation since Feb 2021 – CBI

According to a study released on Wednesday, British manufacturers anticipate to boost prices by the fewest amount since February 2021 during the next three months, while price hikes will still be substantially quicker than their long-run average.

The Confederation of British Industry (CBI) said that its monthly index of manufacturers’ average selling price estimates fell to +19 in June from +21 in May, the lowest level in more than two years but still considerably above the long-run average of +7.

Data released earlier on Wednesday revealed that consumer price inflation in the United Kingdom surprisingly maintained at 8.7% in May, confounding hopes for a drop, but yearly gains in factory prices moderated.

The CBI’s monthly order book balance increased to -15 from -17 in May, returning to near-average levels, although the export order balance plummeted to -29 from -26, the lowest since February 2021.

Manufacturing activity was expected to have contracted somewhat during the second quarter due to poor demand, according to CBI deputy head economist Anna Leach.

The CBI’s estimate of output for the next three months rose from -5 to +4.

Between May 25 and June 13, 233 manufacturers responded to the CBI survey.