UK factory output expected to stabilise, CBI survey shows

LONDON, Oct 22 (Reuters) - Output in Britain's manufacturing sector is expected to stabilise in the next three months despite a dip in orders in October, a Confederation of British Industry survey showed on Thursday.

The reading of -1 in the CBI's volume of output gauge for the next three months came after a run of flat or falling production that began in mid-2022.

"But with orders still falling and labour shortages picking up, significant challenges remain," CBI senior economist Cameron Martin said.

"Stubbornly high costs are also squeezing profitability while deteriorating competitiveness and fragile business confidence continue to weigh on investment decisions."

Official data has shown solid growth in Britain's manufacturing output this year.

• The CBI's monthly order books balance dropped to -32 in October from -9 in September

• The survey's quarterly gauge of expectations for output in the months ahead improved to -1 from -30 in July

• The quarterly measure of expected domestic prices rose to +24 from +11

(Writing by William Schomberg, editing by Andy Bruce)