British manufacturers' order book balance improved sharply in July to the highest level in seven months, and firms expect further growth in orders in the coming months, data from a survey by the Confederation of British Industry (CBI) showed Wednesday.

The latest industrial trends survey showed that manufacturers' order book balance increased to -12 percent in July from -18 percent in June..The figure matched economists' expectations.

Looking ahead, manufacturing firms expect both orders and output to increase in the next quarter, the survey showed.

"Optimism in the sector has risen again, and demand conditions are expected to improve further in the coming three months," Stephen Gifford, CBI Director of Economics, said.

During the three months ended July, 32 percent of the surveyed firms reported an increase in their order books, while 27 percent said orders decreased, resulting in a balance of +5, which was the highest since April 2012.

Manufacturers also reported an increase in production, with the balance rising to +7 percent during the three-month period. Firms were slightly more optimistic about the future prospects of their businesses than they were in the previous quarter.

"The UK CBI Industrial Trends Survey for July and Q3 joins the chorus of surveys indicating that the manufacturing sector's recovery is gathering some pace, albeit less than in the rest of the economy," Capital Economics UK Economist Samuel Tombs said.