Manufacturing to boost Britain’s GDP

An improvement in the CBI industrial trends survey for September indicates manufacturing is set to make a positive contribution to GDP in the third quarter, says IHS Global Insight.

In a note, the economic forecasting company says the improved total and export orderbooks, coupled with higher production expectations, suggest the turnaround for British industry is likely to continue.

Sharply reduced stock levels and the relatively weak pound were both major contributory factors, with the latter enhancing the competitive advantage of British goods both in foreign and domestic markets.

Despite the positive indicators, however, IHS Global Insight warns the survey shows the recovery is still “far from robust” and says serious doubts remain over the resilience of demand once economic stimulus measures start being withdrawn.

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