Order books emptying at record rate as world waits

Manufacturing employers report that orders are falling at their fastest rate
for four years, research by the CBI reveals.

Its Quarterly Industrial Trends survey, published last week, finds the
latest decline in orders has been driven by a sharp deterioration in domestic

Thirty-seven per cent of firms reported a fall, against 16 per cent which
saw a rise.

The difference between the two gives a balance of minus 21 per cent,
compared with minus 9 per cent in the January survey. Total orders are expected
to continue falling sharply over the coming months.

This suggests the weakness in global trading conditions that caused the
manufacturing recession is spreading to the home market, where orders are now
falling at their fastest rate since April 1999.

The survey also shows a decline in manufacturers’ confidence, which can
probably be attributed in part to the war in Iraq – but this is the third
consecutive survey to register a fall.

CBI director-general Digby Jones called for a cut in interest rates to
stimulate demand.

"The end of the Iraq conflict will steady nerves," he said,
"but the world’s economic problems were there before the war and they are
still there now. Manufacturers hoped domestic demand would hold up until there
was a pick-up in global trade, but that does not seem to be happening. We are
not predicting a recession, however."


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