Industry's order-book squeeze is worse than feared

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A 9% balance of firms responding to its latest survey said orders were below normal, a worse result than City economists expected. Export orders are in their worst shape since October last year.

Chief economic adviser Ian McCafferty said: "UK manufacturers report some slackening in demand this month, following the volatility in financial markets and the slowdown in growth in our major trading partners." The CBI also reported a sharp rise in stock levels among manufacturers, casting doubts over production prospects and increasing the pressure on the Bank of England to restart quantitative easing.