UK CBI factory orders weaken in Oct but outlook strong

British factory orders weakened at a faster pace than expected in October, but manufacturers' outlook for the immediate future was its brightest since March 2008, a survey showed on Wednesday.

The Confederation of British Industry's Industrial Trends survey's order book balance dipped to -51 this month from -48 in September. Analysts had forecast a reading of -45.

This contrasted with a more upbeat message from the survey's expectations component, and a parallel quarterly survey from the CBI.

The monthly output expectations balance rose to +4 from -2, the highest level since March 2008, while the more detailed quarterly survey showed optimism rising to +10 from -16, its highest April 2007.

This sense of optimism was buoyed by the best prospects for exports since July 2005, with this component of the quarterly index rising to +16 from -5.

"Having endured a brutal recession, manufacturers appear to be turning the corner, with optimism up and mild growth in output and demand expected over the next three months," said Ian McCafferty, chief economic adviser at the CBI.

"Firms finally seem to be benefitting from a weakened pound, as global markets recover, helping to lift demand for UK exports."