So says the EY Item Club think tank in latest report 20 Feb
Thanks to our good friends at Livesquawk.com for the heads up.
Say Item:
- While still pointing to decent growth, the February Confederation of British Industry (CBI) survey points to some loss of momentum in the manufacturing sector in the first quarter of 2018 after a buoyant performance through the second half of 2017. We now expect GDP growth to ease back to 0.4% quarter-on-quarter (q/q) in the first quarter from 0.5% q/q in the fourth quarter of 2017.
- The overall orders balance dipped to a 4-month low in February, although it remained above long-term norms. February's slowdown in orders seemed primarily due to a moderation in international demand after a very strong January performance. Domestic demand has also come off the peak levels seen in late-2017.
- The outlook for manufacturing looks bright in terms of international demand, but domestic conditions could prove challenging over the coming months.
There is a hawkish tone too though in this comment from Howard Archer Chief Economic Adviser:
While falling back from a 34-year high in January, the February survey still pointed to elevated price pressures in the manufacturing sector so will do little to dilute expectations that the Bank of England may hike interest rates in May.
More from EY Item here
GBPUSD still making its mind up at 1.4000 as some USD demand returns.
