(Bloomberg) --
British manufacturing is shrinking and optimism about exports has plunged to the lowest since 2001 as the country approaches the Oct. 31 deadline to leave the European Union.
Output declined in past three months, led by motor vehicles and transport equipment, the Confederation of British Industry said in a monthly survey published Tuesday. Business optimism deteriorated at the fastest pace since just after the Brexit referendum in 2016, while investment intentions also slipped.
Brexit has “clearly driven concern about the near-term outlook for exports, with citations of political & economic uncertainty abroad and quota/import license restrictions spiking to multi-decade highs,” the CBI said. Manufacturers expect output to continue to decline.
The report comes as U.K. lawmakers prepare to vote later on Tuesday on the Withdrawal Agreement Bill, which would implement Prime Minister Boris Johnson's deal on leaving the bloc at the end of the month.
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The CBI also said stockpiling was muted in the past three months, suggesting that the U.K. economy won't get the same boost from inventory building as it did in the first quarter, ahead of the initial Brexit deadline in March.
To contact the reporter on this story: Brian Swint in London at bswint@bloomberg.net
To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Fergal O'Brien, David Goodman
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