According to the government’s National Statistical Office, British industrial production fell 1% in October and now languishes 4% below the same month in 2000 – the sharpest year-on-year decrease since August 1991 when the nation was officially in recession.
Manufacturing output, which excludes oil and gas and utilities, fell 0.3% in the month, 4.4% lower than a year ago. Annual output has not fallen so dramatically since October 1991.
Reacting to the data, the NSO downgraded the trend growth rate for manufacturing output from -5.0% to -6.0%, and the industrial output trend rate from -3.5% to -4.0%.
But although manufacturing is in the doldrums, the economy overall appears to be in more robust shape. Fuelled by strong consumer spending, the UK appears set to avoid recession and has the best growth prospects of any G7 nation
Commented Halifax economist Adam Chester: “The consumer sector is going to be the dominant force driving [the Bank of England’s] Monetary Policy Committee thinking over the next couple of months. This highlights the growing imbalances between the manufacturing and service sectors and that is potentially going to be a threat to sterling.”
News source: Daily Research News Online