Manufacturers hold firm

The

latest Industrial Trends survey shows that manufacturing has proved resilient in the face of continuing concerns over a wider economic slowdown in the wake of the credit crunch.

The quarterly version of the survey shows that firms' orders growth has held up, with export orders in particular remaining healthy. But rising food and energy costs show no sign of abating and firms expect their domestic prices to go up at the fastest rate for 13 years. Export prices are also expected to rise faster than they have for over two years.

Demand has continued to grow, with 28 per cent of firms saying total new orders increased in the three months to January and 17 per cent reporting a decrease. This balance of +11 per cent exceeded expectations and was broadly in line with the previous four surveys. Slower growth is expected in the next three months.

On the monthly measure, total order book levels were healthy with a balance of +2 per cent saying they were above normal in January, the same as in April 2007 and the highest figure in a quarterly survey since April 1995. Demand this quarter was for the most part driven by export orders.