UK manufacturing order books fall to near 7-month low in July

Manufacturing order books and order expectations for the next three months in the United Kingdom fell to near seven-month low in July as Britain’s decision to leave membership of the European Union weighed on business sentiments, a private survey showed.

The Confederation of British Industry's monthly total order book balance from its monthly industrial trends survey fell -4 in July from -2, while a measure of output over the next three months fell to 6 in July from 23 in June.

Quarterly numbers showed total orders in the three months to July rose to 9 from -4 in April, the highest in a year. But a measure of expected new orders fell to 0 in July, its lowest since January 2012. The quarterly business optimism balance plummeted to -47 from -5, the lowest since January 2009 - around the period of the global financial crisis.

"Manufacturers picked up the pace over the second quarter, with output growing solidly," said Rain Newton-Smith, Chief Economist, CBI.

Meanwhile, total order books are expected to be flat over the next quarter, although exporters believe the fall in the value of the pound will help by making their goods more cost competitive. Further, there are signs Brexit has already hurt confidence among businesses, wary of an expected economic slowdown.