The industrial production growth in the United Kingdom for the month of September was higher than the estimate of economist due to the recovery of manufacturing sector in the country.
According to the Office for National Statistics, the industrial production output in the country rose by 0.6% from on a quarterly basis from Q2 to Q3 this year. On a monthly basis, from August to September, production rose by 0.9% and manufacturing by 1.2%. The average estimate of 28 economists polled by Bloomberg was an increase of 0.6% in production in September.
The industrial production output increased 2.2% in September on an annual basis, and represents an expansion in mining & quarrying by 11.5%, manufacturing by 0.8%, rise in water supply, sewerage & waste management by 7.1% ; and a decline of 3.4% in electricity, gas, steam & air conditioning.
The agency said the rebound in the manufacturing sector was driven by the strength in the production of the basic pharmaceutical products & pharmaceutical preparations, transport equipment, computer, electronic, and optical products.
Howard Archer, economist at IHS Global Insight in London commented, “Manufacturers will be hoping that the recent extended good news on the U.K. economy further lifts business and consumer confidence which in turn translates into sustained higher demand. Encouragingly, there is evidence in recent surveys that businesses are now gradually lifting their investment plans.”
The impact of the latest improvement in industrial production has a minimal impact to the gross domestic product (GDP) estimate of the United Kingdom in the third quarter, according to the Office for National Statistics.
Yesterday, the European Commission (EC) said the outlook for United Kingdom “improved substantially” and raised its forecast. The country’s economy rose by 0.8% during the September quarter. The EC estimated that the GDP of the country will increase by 1.3% this year and 2.2% in 2014.
Based on surveys conducted by Bloomberg, the Monetary Policy Committee of the Central Bank in U.K. is expected to maintain its benchmark interest rate at 0.5% and its £375 billion or $603 billion bond-buying program.
