UK factory order growth hits record, inflation also rises

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Technicians work on a Rolls-Royce engine before it is installed in a car on the production line at the Rolls-Royce Goodwood plant, near Chichester, Great Britain, September 1, 2020. REUTERS / Peter Nicholls

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LONDON, Nov. 24 (Reuters) – UK industrial orders surged this month with a measure of growth reaching its highest level since at least 1977 and manufacturers’ price expectations also hit a 44-year high, according to a survey published Wednesday.

The investigation is likely to add to the Bank of England’s unease over mounting inflationary pressures ahead of the UK central bank’s December 16 announcement on whether it would raise interest rates from their lows pandemic.

The monthly balance of the backlog of manufacturers in the Confederation of British Industry jumped to +26 in November from +9 in October, well above the average forecast of +13 in a Reuters poll of economists.

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The reading was the highest since the start of the CBI series in April 1977.

“It is good to see strong order books and continued growth in manufacturing output as winter approaches,” said Anna Leach, CBI deputy chief economist.

Expectations for output growth remained strong, declining only slightly from the three-month high reached in October.

“But intense challenges on the supply side continue to put pressure on the ability of companies to meet demand,” Leach said.

CBI’s measure of price expectations over the next three months climbed to +67 from +59 in October, the highest since May 1977 as finished goods inventory levels fell to their lowest on record, reflecting global supply chain problems and high demand.

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Reporting by William Schomberg, editing by David Milliken

Our Standards: Thomson Reuters Trust Principles.


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