U.K. manufacturing orders picked up in December

The U.K. factory orders index and the expectations improved significantly in December, suggesting companies are getting more optimistic about the economic outlook. According to the Confederation of British Industry, a gauge of manufacturing index jumped to -12 this month, up from -21 in November, while a measure of manufacturers' output expectations for the next three months soared to zero from -9. The improvement shows that despite the fact that the most recent purchasing managers' survey signalled contraction in the sector, the pace of the slowdown may decelerate. In the meantime, nine out of the eleven sectors reported an increase in inflation expectations, boosted by the increase in building materials, metal manufacture and food and drink.

"Conditions in the sector and the wider economy are likely to remain fragile until global conditions improve over the course of 2013," said Anna Leach, the CBI's Head of Economic Analysis.