Data released Wednesday by the Office of National Statistics revealed a shock fall of 0.8% in manufacturing output during March – in sharp contrast to the bullish noises made recently by the talking heads.
The March data not only reverses the rises recorded for January and February but also suggests that the UK economy may have been in recession – officially defined as two consecutive quarters of manufacturing decline. This confounds recent upbeat reports from the Chartered Institute of Purchasing and Supply and the Confederation of British Industry [WAMN: 08-May-02].
The latter, however, stood by its guns: “Looking ahead, there are signs that the worst is over, with manufacturers widely expecting to increase production in the months ahead according to our survey data,” insists the CBI’s head of economic analysis Doug Godden.
The silver lining is that the latest data will almost certainly deter any increase in interest rates - due to be reviewed by the Bank of England’s monetary policy committee at its meeting today (Thursday).
Data sourced from: Financial Times and The Times (London); additional content by WARC staff