MANUFACTURERS are expecting output to climb strongly during the rest of the year, according to a survey released today.

The Confederation of British Industry's monthly industrial trends survey showed 30 per of firms in the sector which dominates East Lancashire's economy expect orders to rise in the next four months, while just 13 per cent expect them to fall.

At the same time the CBI predicted a steady recovery for the UK economy as a whole.

Kate Barker, the CBI's chief economic adviser, said the signs of recovery should not be taken as evidence that interest rates should rise.

"The economy has just shifted out of first gear and now is not the time to start applying the brakes.

The survey found 39 per cent of firms said current orders were below normal while 17 per cent said they were above normal.

The negative balance of 22 per cent compares to minus 27 per cent in July and minus 25 per cent in June, showing steady but slow improvement.

The CBI said the gains came from domestic demand with "little sign of improvement in export orders".

Of the firms surveyed 49% said export orders were below normal while 12% said they were above normal.

Sudhir Junankar, CBI associate director of economic analysis said: "Manufacturers can take some heart from these findings, but export order books are still below normal and there is continuing pressure on prices."

The industrial trends survey covers 987 manufacturers and was carried out between July 27 and August 18.

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