British factory orders improved to their strongest level in nearly two years in August, according to the Confederation of British Industry’s monthly survey, signaling tentative resilience in the industrial sector amid persistent geopolitical and cost pressures.
The CBI’s order books balance climbed to -25 from -45 in July, a 20-point increase that marks the largest monthly gain since at least 2021 and one of the most pronounced since official records began in the 1970s. The reading, while still in negative territory, represents the highest level since November 2024.
The survey’s forward-looking output expectations also strengthened, while export orders shifted into positive territory for the first time since June 2022. The CBI’s price expectations gauge rose to +22 in August from +11 in July, a move attributed to a recent rebound in crude oil prices.
Cameron Martin, CBI Senior Economist, said stronger global demand had provided "welcome relief" for manufacturers, noting the sharp improvement in export order books. However, he cautioned that it remained unclear whether the gains marked the start of a sustained recovery, given ongoing cost pressures and selling price expectations that remain elevated compared with historical norms.
The survey, conducted between July 29 and August 15 among 307 manufacturers, reflects mixed signals across the broader economy as policymakers weigh inflation risks against growth concerns.
