Manufacturers at a new peak, says CBI

Manufacturers are in their best shape since the onset of the credit crunch after a fifth consecutive monthly rise in new orders, the CBI employers' lobbyists said yesterday.

Its latest monthly industrial trends survey of nearly 400 companies revealed 28 per cent of firms reporting higher than normal order books in September against 19 per cent saying they were lower than usual.

The resultant 9 per cent positive balance is the highest since August 2007, when markets were first shaken by the subprime crisis.

Confidence among manufacturers over the coming quarter is at its highest level since 1995, according to the CBI's economics director Stephen Gifford.

He said: "This month's results show the manufacturing recovery continuing to gather pace. Order books are the fullest they've been since the start of the financial crisis, and firms are ramping up production to meet demand."

The latest upbeat news comes after the Chartered Institute for Purchasing & Supply's purchasing manager index reported the fastest overall activity in more than two years last month. Official data have been more muted, with manufacturing output slipping 0.7 per cent in July.

Analysts also flagged up the threat from the pound to UK exporters as sterling moved to eight-month highs following the US Federal Reserve's decision not to slow the pace of its quantitative easing programme.

The Council of Mortgage Lenders offered more evidence of the UK's growth spurt yesterday as banks and building societies handed out £16.6bn home loans last month, 28 per cent ahead of a year earlier.

Retail sales: Slip loss of appetite

Britons eased back on the barbecues last month after a glorious July, sending retail sales skidding lower for the first time since April.

Overall retail volumes dropped 0.9 per cent in August, a much sharper fall than expected, with a 2.7 per cent fall in food sales the main culprit, said the Office for National Statistics. July's sales roared up 1.1 per cent as sporting success and a heatwave boosted the feelgood factor.