LONDON, (Reuters) - Demand for British factory exports fell to a 21-month low this month, causing overall orders growth to slow sharply, figures from the Confederation of British Industry showed on Thursday.
The numbers follow signs of greater economic weakness in Britain’s main euro zone trading partners in recent months, and a warning from the Bank of England on Wednesday that a euro zone slowdown could exact a heavy toll on Britain.
The CBI said that its export order balance tumbled to -24 in September from -3 in August, its lowest level since January last year and below a long-run average of -20.
The overall orders balance fell to -4 from +11, below economists’ forecasts of a drop to +9 though above a long-run average of -16, suggesting that orders continued to grow.
“Against a backdrop of acute political uncertainty at home and abroad, exports orders for UK manufacturers are faltering, which is disappointing,” said CBI deputy director-general Katja Hall.
“However, it’s encouraging that output growth has remained solid and firms expect production to rise strongly in the next quarter,” she added.
The CBI’s factory output balance for the next three months slipped only slightly to +27 from August’s +31, and is well above a long-run average of +7.
Britain’s Office for National Statistics earlier this month reported that industrial output rose by 0.5 percent in July, the biggest increase in five months.
The CBI survey was carried out between Aug. 20 and Sept. 10, and received responses from 488 manufacturers.
Reporting by David Milliken, editing by Andy Bruce