British factory orders fell at their slowest pace in nearly two years in September as export demand improved, a survey showed today.
The Confederation of British Industry's monthly industrial trends survey showed the total orders balance improved to -5 in September from -8 in August.
That was the highest since December 2004 and far better than analysts' forecasts for a slide to -10.
The employers' group said the improvement was driven by export orders, which showed a balance of -3 after -6 in August. The survey also showed manufacturers expected to raise output in the next three months, with that balance rising to +14 from +11.
Analysts said the strong readings added weight to expectations that the Bank of England will raise interest rates again this year, following its surprise quarter percentage-point increase last month to 4.75 per cent.
There were also signs that price pressures are subsiding, with manufacturers' expectations for average prices over the next three months easing to a balance of +8 from +13 in August, which was the highest since January, 2005.