Although business confidence has fallen in every UK region with cost pressures remaining intense and activity in the manufacturing sector expected to slow firm export orders across the majority of regions has helped to limit the slowdown this quarter. These are the findings of the latest CBI/Experian Regional Trends Survey.
Lai Wah Co, CBI head of economic analysis, commented: Manufacturing confidence has tumbled over the past quarter. The climb in oil and other raw material prices over recent months has driven costs up significantly. Although firms are having some success in passing these costs on, profit margins are under pressure.
Peter Gutmann of Experian added: Exports are helping to limit the slowdown in the manufacturing sector, boosted particularly by sterlings weakness against the euro. However, the near-term outlook for manufacturing still looks tough as the economy enters a precarious phase.
While the majority of regions reported falls in total orders, the opposite was true for export orders. Seven out of eleven regions saw an increase in overseas demand this quarter.
Yorkshire & the Humber led the way reporting a firm rise in export orders, as it has done for the past four years, followed by Northern Ireland and Wales. Only two regions the West Midlands and North East saw a marked decline in export orders.