30 June 2019
The composite measure based on 546 respondents showed the sharpest fall in distribution volumes since August 2009. While activity in the services sector continued to fall at the fastest pace since December 2012. Meanwhile, manufacturing output was broadly flat in the three months to June, affected by the changed timing of car production shutdowns.
Looking ahead, private sector activity is expected to be broadly stable in the three months to September (-1%) across all sectors.
The CBI Growth Indicator follows other recent data which suggests UK economic growth has slowed noticeably in the second quarter of 2019, as the boost from stockpiling activities in Q1 fades. We expect underlying growth to remain subdued with risks from Brexit and global trade tensions remaining high. For more detail on our view of the outlook, see our economic forecast.
Rain Newton-Smith, CBI Chief Economist, said:
“There are some temporary factors pushing down activity at the moment, such as companies adjusting their stocks following the Brexit extension, interruptions to car production and poor weather. But underlying activity and confidence is clearly subdued.
“The UK economy is being stifled by uncertainty about the UK’s relationship with the EU. The need for the new Prime Minister to secure a deal with the EU is urgent. Every day in which business and government are distracted by Brexit is a day not spent delivering the economy of the future.”