Jul. 23--Hopes for an imminent recovery in the manufacturing sector were dealt a heavy blow with news that order books are shrinking at the fastest pace in over 17 years.

In a gloomy survey, the Confederation of British Industry revealed that the pound's 20pc drop over the past two years had done little to revive the fortunes of the manufacturing sector.

Orders plunged at their steepest rate since January 1992 this month, with the recession also keeping domestic demand in check, said the CBI.

The CBI also dashed hopes that manufacturers had already begun to fill up their depleted store rooms -- a move that would have boosted output and employment.

Instead they worked through their stocks of finished goods at a rate not seen since 1951.

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