Despite a slowdown since January, the latest survey indicated that new order growth remained faster than at any other time since March 2015. This was driven by strong sales to domestic clients, which helped offset weaker growth in export markets during February. A number of manufacturers commented on greater demand from energy sector clients.
Meanwhile, manufacturers signaled that input cost inflation was at its highest level since September 2014. This was linked to increased prices for a range of raw materials, particularly metals and oilrelated inputs. However, factory gate price inflation was only marginal and slipped to a three-month low in February, thereby suggesting a continued squeeze on operating margins.