UK factory orders grow at weakest rate since April - CBI

A worker attaches a connector to electrical wire on the factory floor of PP Control and Automation near Cannock, Britain, July 6, 2016. REUTERS/Phil Noble/File Photo

LONDON, (Reuters) - British factory orders grew in September at their weakest rate since April, and output growth over the past three months has also slowed, a monthly survey from the Confederation of British Industry showed on Friday.

The CBI’s factory order book balance slipped this month to +7 from +13 in August, below expectations in a Reuters poll for the reading to remain unchanged. The CBI said the weakening was largely driven by the food and drink sector.

Britain’s economy has slowed this year as the effect of a weaker pound has pushed up inflation and weakened consumer demand, but the Bank of England has said it is likely to raise interest rates at its next meeting on Nov. 2.

It hopes stronger exports will help offset weaker business investment and uncertain consumer demand.

The export order book balance softened marginally to +10 from +11, while the output balance for the past three months dropped to +17 from +30, its lowest since June, which the CBI said reflected weaker food and drink production.

However, all three balances remained well above their long run averages and manufacturers expect a rebound in October.

“Manufacturers continue to report solid growth in output, while total order books and export order books are holding firm,” CBI economist Anna Leach said.

“Expectations for selling prices were largely in-line with the previous month, but price pressures do appear to have moderated somewhat since earlier in the year,” she added.

The results are based on a poll of 429 manufacturers conducted between Aug. 24 and Sept. 14.

Reporting by David Milliken, editing by William Schomberg