UK Factory Orders See Largest Decline Since 2020, CBI Reports

On May 21, Jin10 reported that a survey conducted on Thursday revealed the largest drop in UK factory orders since September 2020, alongside a significant rise in expected sales prices. This situation highlights the challenges faced by the Bank of England. According to the Confederation of British Industry (CBI), the industrial order balance in May recorded -41, marking a new low since September 2020, while the expected industrial price balance for May reached 38, the highest since February 2023. Cameron Martin, a senior economist at the CBI, noted that the ongoing Middle East conflict is driving up energy costs and causing further supply chain disruptions, presenting new challenges for manufacturers already struggling with weak demand. The Bank of England is closely monitoring the situation to determine whether it needs to raise interest rates to counteract the inflationary pressures caused by the energy price shock from the Iran war, or if the decline in demand suggests that any rise in overall inflation is merely temporary.