Industry confirms sharp orders decline

Six out of 11 regions of the UK suffered a sharp drop in manufacturing orders in the four months to April. Production was either static or down in seven regions, confirming recent figures indicating stagnation in industry.

The weak results of the latest survey by the Confederation of British Industry and the consultancy Business Strategies Limited came as Kenneth Clarke, Chancellor of the Exchequer, and Eddie George, Governor of the Bank of England, held their monthly meeting yesterday. The two appeared to have decided to leave base rates unchanged for the time being.

However, in a further sign of the split between the fortunes of manufacturing and the rest of the economy, a leading City analyst yesterday revised up his prediction of the increase in house prices likely this year. Rob Thomas, building societies analyst at the investment bank UBS, boosted his forecast from 2 per cent to 5 per cent following the run of monthly price increases reported by Halifax Building Society.

Yesterday's regional survey by the CBI/BSL showed the steepest fall in orders in Wales and Yorkshire and Humberside. The only significant increases were reported in the East Midlands and Scotland, thanks to an increase in export demand. Despite slower growth in some of Britain's key markets, export orders were stronger than domestic orders in most regions.