The CBI has reported UK exports are on the rise
The Industrial Trends Survey also contained good news for UK manufacturers with expectations for the future hitting its highest point in more than 20 years.
Export order books were their fullest since December 2013, the report revealed after surveying 423 firms – of which half was accounted for by the pharmaceutical and mechanical engineering sectors.
Total order books remained firm in March, after strengthening to a two-year high in February.
The rate of growth was also found to be at its fastest pace since July 2014, growing by 23 per cent, with manufacturers anticipating that it will accelerate even further in the sort-term.
The boost to manufacturers has been helped by the fall in the pound which has helped exports become more competitive.
However, a weaker pound has meant that manufacturers importing raw materials have seen costs rise.
Boosts to the pharmaceutical and mechanical engineering have helped boost exports
The CBI said average output prices were on course to rise over the next quarter, as manufacturers pass down rising import costs to consumers.
It said 35 per cent of firms expect to see output prices rise and 7 per cent believe they will fall, leaving a balance of plus 29 per cent.
Anna Leach, CBI Head of Economic Intelligence, said: “It’s been a strong month for UK manufacturers, with production growing robustly and overseas demand on the up.
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“The past fall in the pound seems finally to be helping lift demand for UK manufactured exports, which rose at one of the fastest paces in this survey’s history.
“And manufacturers are positive about the quarter ahead, expecting output to grow at the fastest rate since February 1995.
“But the flip side is that cost pressures are widespread, and manufacturers expect factory-gate prices to continue to rise strongly over the next three months. And this will also put pressure on prices generally.
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“Innovation continues to be a fundamental driver of UK competitiveness and productivity gains and will influence the success of UK companies over the longer term.
“That’s why we want a commitment from the Government to spend 3 per cent of GDP on R&D by 2025 – a joint target to be met by the private and public sector.”
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the data revealed a brighter picture for exports.
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He said: "The CBI's survey indicates that exports are picking up rapidly, softening the blow to manufacturers from slowing domestic demand.
"Producers are benefiting both from the improvement in global trade flows and the weaker pound. UK manufacturers, however, are heavily reliant on imported inputs.
"As a result, net trade likely will not offset fully the slowdown in domestic consumption this year."