Based on its latest survey of monthly industrial trends, the CBI has reported that output growth for the UK manufacturing sector increased in the quarter to February.
The CBI’s survey covers 224 manufacturers. Growth was based fairly broadly among sub-sectors, with output volumes growing faster than they were a month earlier. Most manufacturers also indicated that they expected growth to pick up further in the coming quarter. Finished goods stocks also improved marginally, but remained inadequate. Inflationary pressures were evident, however, with almost four in five manufacturers expecting to raise their prices in the coming quarter.
In a statement, the Deputy Chief Economist of the CBI, Anna Leach, pointed to a need for government intervention to continue encouraging investment, saying:
“With high inflation dampening growth prospects in the wider economy, the Government must use the Spring Statement to help get businesses investing more, supporting higher growth, productivity and wages. That should start with a permanent Investment Deduction as a successor to the Super Deduction, which ends next year.”
The Chair of the CBI Manufacturing Council and Group Director at INEOS, Tom Crotty, also said while the government needed to address the challenges in the short term, it also needed to take a far-sighted approach to raising productivity, such as by approaching regulation and skills in way that will suit the challenges of the future.
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