Orders and output fall, but SMEs expect activity to stabilise

Both domestic and export orders among the UK’s small and medium-sized manufacturers fell in the three months to October. Production levels continued to contract modestly, while business sentiment deteriorated for the second consecutive quarter.

The CBI’s latest quarterly SME Trends Survey, which had 362 respondents, showed that total new orders fell (a balance of -13%), reflecting declines in both domestic orders (-11%) and export orders (-21%), with the latter falling at the fastest pace since July 2009 (-32%). While domestic orders are expected to be flat over the next quarter (-2%), demand for exports is expected to fall further, albeit at a much slower rate (-5%).