UK Manufacturers' Price Expectations Fall to 9-Month Low

The hope of British producers for a higher price dropped to the lowest level nine months in June, with a rare sign of the pressure of the price of sauce at the time of consumer price inflation is expected to reach two digits.

Confederation of British Industry Industry Industry Prices – which shows company expectations for the next three months selling prices – down to +58 in June from +75 in May, the lowest since September. The index is still far above the long-term average +5.

We might see the first signs that weaker activities begin to slow down the rate of price increases in this sector,” said CBI Deputy Head of Economist Anna Leach.

CBI’s headline industry command gauge fell to +18 in June from May +26, a greater decline than falling to +22 which is estimated to Export orders also weakened.

Weaker price data will offer comfort for the Bank of England, which is carefully watching the signs that the inflation surge to the highest 40 years 9% in April is embedded in the company’s long-term plan for pricing and payment.

The increase in “strong” interest rates can be needed if the company increases the price increase to protect the profit margin, and the main wage growth remains at the current high level, Boe warns last week after the forecasting of inflation will exceed 11% in October.

Samuel Tomb, Head of Economist at Pantheon Macroeconomics, said the latest CBI data suggested inflation would underline Boe’s estimates.

Producers seem to receive pressure on their margin now because demand growth has slowed down,” he said.

Producers in the CBI survey expect slower growth for the next three months, although the pile of orders endangers the impact of weaker demand, at least temporarily.