UK manufacturers plan to hike prices on pound drop

London - British manufacturers see higher prices ahead.

Expectations for selling-price inflation in the sector for the coming three months were the strongest since 2014 in November, according to a monthly survey from the Confederation of British Industry.

Exports declined, but remained above their long-run average.

Manufacturers are getting a boost to sales abroad from the pound’s 16% decline since the Brexit referendum in June.

Yet the currency’s slide is also pushing up import costs and has already raised the price of Marmite spread, Walkers potato chips and Toblerone chocolate bars for UK consumers.

Official figures published last week showed the cost of fuel and raw materials rose 4.6% in October, the most since records began. Factories raised output prices by 0.6% in response.

The increase in selling-price expectations was driven by the food and drink sector, the CBI said.

Only three of 18 sub-sectors said they were planning to cut prices according to the report. The Bank of England said this month that consumer-price inflation will go above its 2% goal next year and stay there until the end of the decade.