But this too reflects the normal seasonal anticipation of raising list prices in the New Year -
But this too reflects the normal seasonal anticipation of raising list prices in the New Year – an expectation which has been disappointed in recent years.Mr Junankar said the inflation outlook remained very promising Kevin Darlington, an economist at ABN-Amro, agreed. The expected output balance improved a shade to 10 per cent from 9 per cent last month, although the increase would be greater adjusted for the normal seasonal downturn in December.Manufacturers’ expectations of pushing through price rises also increased slightly. If interest rates do increase further, as widely expected, it is unlikely to take place until some time after the New Year when the Bank has more evidence on how fast the economy has expanded in the final quarter of 1997.According to the monthly CBI survey of industrial trends, the modest improvement in orders did little to boost business optimism. Domestic orders remained strong while export orders picked up from their depressed level.
The CBI said the strong pound was still hitting exports. But it admitted: “The sharp deterioration in order books recorded in the middle of the year seems to have been halted.”The balance of manufacturers surveyed saying overseas orders had risen rather than fallen was minus 29 per cent, a bit less deep into negative territory than November’s minus 34 per cent balance.
The balance reporting an increase rather than a decrease in total orders climbed to plus 2 per cent from minus 3 per cent. Sudhir Junankar, a CBI economist, said the slight improvement in export demand provided a “welcome breathing space for hard-pressed exporters”.Some City economists were far more upbeat. Adam Cole at James Capel said: “This may be the first sign that the worst is over for exporters.”While others shared the CBI’s caution, all agreed that the latest results did little to change the Bank of England’s interest rate calculation. Export orders have improved despite the strength of sterling, according to the latest business survey. This brighter-than-expected picture on the industrial front contrasted with other reports hinting at a gloomier consumer outlook, says Diane Coyle, Economics Editor. Manufacturers’ order books have returned to their healthiest level since August 1995, the Confederation of British Industry reported yesterday.
Part of the problem is the strong pound which has deterred overseas customers from spending. The retailer makes around a fifth of its sales from outside the UK. The news of disappointing current sales growth came as the company reported a 24 per cent rise in first half turnover to pounds 60.9m and pre-tax profits 10 per cent ahead to pounds 6.1m, boosted by a first time contribution from the Oxo Tower restaurant and a full year’s trading from the Leeds shop. Mr Wan said he planned to open another two department stores in the UK and a further four restaurants. Mr Wan said he was `within a few months’ of announcing the next department store, which will be located either in Edinburgh, Glasgow, Newcastle or Manchester
Investment column, page 24.
