© Reuters. FILE PHOTO: Workers are seen on the production line at Nissan’s car plant in Sunderland, Britain, October 10, 2019. REUTERS/Phil Noble
LONDON (Reuters) – British manufacturers reported the worst stock shortages on record, caused in large part by a post-lockdown lack of components for the electronics industry and in plastics, according to a survey published on Monday.
The Confederation of British Industry’s index for stock adequacy fell to the lowest since the survey began in 1977, sinking to -14 from July’s -11, the third record low in as many months.
The survey also showed expectations for output price growth over the next three months remained close to June’s nearly 30-year high, something the Bank of England will note after it said this month that it planned modest tightening of monetary policy.
The CBI’s index for industrial output growth in the three months to August slipped from a record high in July, easing back to +22 from +37. But orders edged up to +18 from +17. Economists polled by Reuters had expected a reading of +16 for orders.
“Manufacturing activity remained strong this month, with total order books remaining firm and most sub-sectors reporting rising output,” Alpesh Paleja, a CBI economist, said.
“However, early signs from the data suggest that growth in activity may have peaked.”
The slowing of output growth was largely caused by the motor vehicles sub-sector which has been hit hard by a shortage of chips.
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