EEF: UK manufacturing confidence falling away

The report showed manufacturing activity had fallen in the last three months in response to growing economic uncertainty in major markets. This has fed through to an easing in investment and recruitment intentions. In line with the deterioration in prospects for the Eurozone economy in particular next year, EEF announced that it had reduced its forecasts for manufacturing growth from 2.2% to 0.9% in 2012. EEF Chief Economist Lee Hopley, said: "The signs of caution that had been emerging through the second half of this year have clearly become more entrenched as global growth concerns have escalated. There are not only question marks over wider manufacturing prospects at the beginning of 2012, but also the exports and investment needed to underpin sustainable growth. "Manufacturing has been a key pillar in the recovery so far and it looks like the sector will still end the year on the up. However, short term confidence has all but fallen away." While sectors such as basic metals, rubber, plastics and electronics reported negative output and order balances, the EEF said motor vehicles and mechanical equipment experienced a stronger, more promising quarter. It maintained that this pattern looked set to continue on the back of strong demand from civil aviation.