Manufacturers expecting lowest inflation in more than two years - CBI

Manufacturers’ expectations for selling price inflation fell to their lowest level in more than two years in May, according to the latest survey from the scandal-hit Confederation of British Industry.

The index of manufacturers’ average selling price expectations declined to +21 from +23 in April, hitting the lowest level since March 2021. Still, expectations remained well above the long-run average of +6.

Meanwhile, the total orders balance rose to -17 in May from -20 the month before, coming in ahead of consensus expectations for a reading of -19.

CBI deputy chief economist Anna Leach said: "Our latest survey suggests the recent pressures on manufacturing activity have so far persisted through the second quarter. Sentiment continues to deteriorate and expectations for output growth in the coming three months have turned negative, which doesn’t suggest UK manufacturing is poised to recover any significant momentum in the near-term.

"With demand subdued and the outlook for costs improving, manufacturers expect growth in their selling prices to slow, which should feed through to measures of inflation over time."