Official statistics tell you what happened weeks or months ago. Business surveys try to tell you what is happening now. In Britain, one of the longest-running of these is the CBI industrial trends survey, which asks manufacturers how business is going each month. It rarely moves markets on its own, but it is a useful early signal of where the UK economy is heading.
What the survey is
The Confederation of British Industry, a major UK business lobby group, runs the industrial trends survey every month. It asks several hundred manufacturing firms about their order books, output, prices, stocks and expectations. Once a quarter, a fuller version includes questions on business optimism, investment intentions and constraints such as skills shortages.
The survey has been running since the late 1950s, which makes it one of the oldest business surveys in the world and useful for comparing today’s conditions with past cycles.
How to read the numbers
The CBI reports most answers as a balance. It takes the percentage of firms saying something is above normal or rising and subtracts the percentage saying it is below normal or falling. A reading of minus 20 for total orders means 20 percentage points more firms reported below-normal orders than above-normal ones.
That means the level is about breadth rather than size. It tells you how widespread strength or weakness is, not by how much orders have changed. A negative balance is common for the orders measure, so traders focus on the direction of change and how the figure compares with forecasts and its long-run average.
The parts traders watch
Total order books give a sense of demand. Export orders show how British manufacturers are faring abroad, which links to sterling and global growth. Expected output over the next three months is a forward-looking signal. The price expectations balance is particularly important for the Bank of England, because it shows whether manufacturers plan to pass higher costs on to customers.
The quarterly optimism question gives a broad read on business confidence. Sharp falls often come around periods of uncertainty, such as a Budget, an energy shock or major political events.
Why markets care
Manufacturing is a smaller part of the UK economy than services, so the CBI survey does not carry the weight of GDP or the purchasing managers’ indices. But it is timely and long-running, which helps confirm or challenge other data. If both the CBI and the manufacturing PMI point the same way, traders take the signal more seriously.
For sterling and gilts, the price questions often matter most. Rising price expectations can add to the case for higher interest rates, while weak orders can strengthen the argument that the economy needs support.
Common mistakes
The first mistake is reading the balance as a percentage change in orders. It is not. The second is overreacting to a single month. Survey data is noisy, and one bad reading can reverse the next month. The third is ignoring revisions in other data, since the CBI is best used alongside official figures rather than instead of them.
The beginner takeaway
The CBI survey is a quick health check on British industry. Use it to build a picture of the economy rather than as a trading signal on its own. If you want to see how well you combine different pieces of evidence before making a decision, take the free Samuel & Co Trading Trader Assessment.
