| UK industrial production unexpectedly falls in January |
British manufacturing output unexpectedly fell in January at its sharpest monthly rate since last August, reversing December's strong rise after icy weather in January dented production, official data showed on Wednesday.
The Office for National Statistics said manufacturing output fell 0.9 percent on the month, well below analysts' expectations for a rise of 0.3 percent.
The figures contrast with recent surveys suggesting manufacturing activity has accelerated, and come just after Prime Minister Gordon Brown said Britain's recovery from its worst downturn on record was fragile. [ID:nLDE6282GG]
Analysts said February's data could yet show a rebound, but were unsure how much of January's fall was down to the weather.
"The figures are very disappointing. It is impossible to blame everything on the weather, but it does seem to be having an impact," said Philip Shaw, economist at Investec.
"The only comforting feature with manufacturing is that all the surveys show the output trend to be positive, which gives us confidence that January's official reading is a bit of a rogue number."
The pound fell half a cent against the dollar as investors worried that slow growth might undermine government plans for fiscal consolidation after data on Tuesday showed a sharp drop in British exports.
The ONS said the drop in manufacturing output came after some firms had rushed to complete orders in December before January's rise in value added tax, and that firms reported that harsh weather in the month had also depressed output.
The ONS said 11 of the 13 manufacturing sub-sectors recorded declines in output in January, but there were small rises in output from the machinery and equipment and food, drink and tobacco industries.
The wider measure of industrial production, which includes utilities, mining and oil and gas extraction, fell 0.4 percent on the month -- also the biggest fall since last August and confounding expectations for a rise of 0.3 percent.
Year-on-year, manufacturing output rose 0.2 percent, its first rise since March 2008, and industrial production fell 1.5 percent on the year, its smallest annual decline since April 2008.
Financial Mirror, March 10, 2010 |
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10-03-2010 |
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