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Strong outlook for manufacturing

Activity in the UK manufacturing sector remained solid in May, and output is expected to rise strongly in the next three months, the latest CBI Industrial Trends Survey shows. Output volumes continued to grow at the same rate as in the previous two months, and with stronger growth anticipated for the coming quarter. The survey of 437 manufacturers found that total order books remained well above the long-run average. Export orders fell below normal, mainly driven by the chemicals and automotive sectors, but remained strong by historical standards.

Katja Hall, CBI deputy director-general, said: “Overall, the manufacturing sector continues to perform well. Output growth is on an upward trend, with firms expecting an even stronger rise in the next three months.

“Inflationary pressures are under control, with firms now expecting only a slight rise in the selling prices of their goods.

“The recent rise in Sterling, coupled with a tepid recovery in the Eurozone could weigh on export demand. As the UK’s economic recovery gains a firmer footing, we need to ramp up manufacturing exports to high-growth markets, driving job creation here in the UK.”

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