The survey of 357 manufacturers revealed that new orders continued to expand at a brisk pace, with a pick-up in the domestic market offsetting a slight slowdown in new export orders. Sentiment about general business conditions was unchanged for a second consecutive quarter, but optimism regarding export prospects stalled, having increased steadily for much of the past two years. Growth in output and total orders are expected to slow moderately in the three months to October.

Investment intentions deteriorated significantly in the three months to July. Firms are planning to keep spending on plant and machinery broadly stable over the year ahead and expect to cut back on investment in buildings at a pace that is broadly in line with the historical average. However, firms have dialled down on investment in "intangible" assets - product & process innovation and training & re-training - with spending in both categories expected to fall at a pace unseen since the global financial crisis.