UK factories enjoy pre-summer boost as output rises at fastest pace in three years – Telegraph.co.uk

British factories enjoyed the biggest rise in output in more than three years in the quarter to May, as the weaker pound continued to bolster exports, according to the Confederation of British Industry (CBI).

A survey by the business group showed robust growth in the mechanical engineering and chemicals sectors pushed output up at the fastest pace since December 2013.

Domestic and overseas demand helped order books to swell to their highest since February 2015, while export orders matched the three-year high seen in March.

The CBI’s poll of 432 manufacturers showed bosses expected output to grow “at the same robust pace in the coming quarter”, with 37pc predicting growth, compared with 10pc expecting a decline.

Rain Newton-Smith, CBI chief economist, said: “The summer sun has come out early for Britain’s manufacturers. Robust demand at both home and abroad is reflected in strong order books, and output is picking up the pace.”

Ruth Gregory, an economist at Capital Economics, said the data provided “another reason to be optimistic” about economic growth in the second quarter, following the UK’s 0.3pc expansion in the first three months of 2017.

Official figures this week showed UK retail sales saw a revival in April, suggesting consumer spending was unlikely to grind to a halt this year, even as economists expect higher inflation to put the brakes on growth.

UK factories enjoy pre-summer boost as output rises at fastest pace in three years – Telegraph.co.uk