By Daniel Hunter

The recovery in British manufacturing continued in the three months to April, but the pace of growth eased and export orders growth remained sluggish, according to the latest CBI Quarterly Industrial Trends Survey.

The survey of 468 firms reported an easing of growth in total new orders, as expected from January’s quarterly survey, but this still remained well above average. Domestic orders rose modestly, whilst exports growth remained unexpectedly sluggish. Meanwhile output growth fell to its lowest since January 2013, but above the long-run average.

Firms have stronger expectations for the three months ahead, with output and orders growth anticipated to firm up and predictions for exports growth at their strongest since July 2014. But the number of firms highlighting orders or sales as a possible constraint to activity rose to its highest level since October 2013.

Numbers employed continued their record run of growth, albeit rising at the slowest pace in over two years, but are expected to be flat next quarter.

Looking to the year ahead, investment intentions have fallen sharply from strong levels across all categories, though they do remain at or above their long-run averages. Growth in optimism about both the current business situation and export prospects for the year ahead also dropped back.

Katja Hall, CBI Deputy Director-General, said: “It’s encouraging that our manufacturers are seeing - and expect to see - continued growth, with rates of expansion still above average.

“Exports keep dragging at the heels of growth: firms are finding the recent rise in the Pound against the Euro challenging, making them less competitive in Europe, while the unravelling situation in Greece is creating uncertainty.

“Among the measures business wants in the first 100 days of a new government, an ambitious, long-term export strategy must be a central element to keep growth on course.”