Manufacturing pay settlements have been creeping up, but still averaged only 2.8 per cent over the three months to July, an outcome the EEF described as "benign".

The manufacturing organisation monitored 172 pay deals for 26,095 employees in its latest bulletin, but warned the samples in each month were small and could be revised.

These showed deals averaging 2.7 per cent in May, 2.8 per cent in June and 2.9 per cent in July.

"Whilst these latest figures are marginally higher than those in the first half, they continue to remain broadly in line with the average level seen in 2006," said David Yeandle EEF deputy director of employment policy.

Over the latest months, only four per cent of deals resulted in a freeze, fewer than at any time since October, 2004. Less than 2.5 per cent of companies deferred settlements.

Overall, 114 of 172 deals were for between 2.01 and three per cent - 47 of them for three per cent exactly. Another 15 were for two per cent. Of the remainder, six were four per cent and nine for more.

Across the economy, the pay specialists Industrial Relations Services reported few signs of the recent spike in consumer price inflation spilling over into wage deals.

The consultancy said settlements have remained steady even though the consumer price index rose to a two-and-a-half-year high of 2.5 per cent in June, before easing back marginally to 2.4 per cent last month - while the retail prices index most closely watched by pay bargainers has reached 3.3 per cent.