Engineering and manufacturing companies in the Yorkshire region are still finding life tough - but they may have spotted a chink of light at the end of the tunnel.

This is the conclusion of the latest quarterly survey carried out by EEF Yorkshire and Humberside, covering about 100 of its engineering members.

An improvement in orders towards the end of 1999 had slowed with deliveries down and the number of firms working below capacity increasing, reported the engineering firms.

Plans for capital investment are worsening more slowly and a majority of companies are reporting stability. Yet optimism is growing, with greater expectation of orders, deliveries and employment levels.

Ian Hughes, director of the Yorkshire and Humberside EEF, said the survey sent a clear message to the Government and the Bank of England: "High interest rates and the strong pound will continue to hurt manufacturing industry.

"Further interest rate rises are neither justified nor welcome. Some companies are just beginning to see the glimmerings of a brighter picture and it would be wrong to choke off that potential."

Converted for the new archive on 30 June 2000. Some images and formatting may have been lost in the conversion.