THERE have been signs of recovery in the beleaguered manufacturing industry with a closely-watched survey showing output expectations surging to their highest in almost a year.

The CBI’s monthly industrial trends survey for March found 35% of firms predicted increases in output over the next quarter, with only 13% expecting a fall, giving an overall positive balance of 22%, the highest since April last year.

Recent falls in the value of the pound also boosted UK trade as export order books showed a pick-up, with a negative balance of 11% of companies reporting levels above normal in what marks the highest reading for three months.

The survey of 398 firms, which was conducted between February 21 and March 13, suggested total output growth remained subdued, but steady with a negative balance of 15% compared with minus 14% in February.

Howard Archer, chief UK and European economist at IHS Global Insight, said the survey “offers some hope that the manufacturing sector may be beginning to pick up after an apparently torrid start to 2013”.

Official figures revealed output slid by a dismal 1.5% during a snow-hit January, which meant overall industrial output dropped by 1.2% in the month, raising fears of a triple dip recession.

Stephen Gifford, director of economics at the CBI, said: “Manufacturers appear more optimistic about the next few months than the official figures and commentary would suggest, with sharp rises in output expected right across the sector.”

Output is expected to rise rapidly, particularly across food, drink, tobacco and mechanical engineering sectors, according to the CBI.

Average prices are also expected to fall back over the next three months, with the overall positive balance of 5% marking the lowest level for six months and a big drop from 20% in February.