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The British manufacturing output increased at the fastest pace since early 1995, the latest quarterly Industrial Trends Survey from the Confederation of British Industry showed Tuesday.
A balance of 31 percent said the volume of output increased over three months to July, the highest since January 1995.
However, in July alone, the new order balance fell to 10 percent from 16 percent in June.
The balance for expectations for output growth reached 28 percent, the highest since April 2014.
The survey revealed that a balance of +14 percent reported an increase in total orders in three months to July. Despite slowing, the export order balance remained strong, at 17 percent.
Expectations for domestic order growth were the most upbeat since April 2015, whereas expected growth in export orders was the highest in four decades.
A balance of +5 percent said they were more optimistic about the general business situation.
"It's great to see the benefits from the decline in sterling for UK exporters feeding through," Rain Newton-Smith, CBI chief economist, said.
"But the flipside is the broader hit to consumer spending power across the economy from stronger inflation, which is likely to have fueled the slowdown in the economy in the first quarter and is expected to pull down growth in the second quarter," the economist added.