- Production declines 0.2% in September, more than forecast
- BOE has warned of global slowdown threatening U.K. growth
U.K. industrial production fell more than forecast in September, capping a weaker third quarter than initially estimated.
Output fell 0.2 percent in September, more than the 0.1 percent decline forecast by economists in a Bloomberg survey. The Office for National Statistics in London also said that production rose 0.2 percent over the quarter, less than the 0.3 percent in last month’s GDP data. The revision has a negligible effect on the 0.5 percent economic growth estimate.
In further bad news for the third quarter, separate data showed that trade will be a drag on economic growth in the period, though the ONS said it can’t yet quantify the extent of the effect. The goods-trade deficit widened by almost 6 billion pounds to 32.2 billion pounds as exports dropped 7.9 percent. The total trade gap in goods and services more than doubled to 8.5 billion pounds.
Bank of England Governor Mark Carney said on Thursday that the pace of U.K. growth has “ticked down” and the progress of the economy has been mixed. While domestic demand is strong, global threats and record-low inflation mean the central bank is keeping the benchmark interest rate on hold for now.
Manufacturing production rose 0.8 percent in September from August, the most since April 2014, the ONS said on Friday. From a year earlier, industrial output rose 1.1 percent and manufacturing was down 0.6 percent.
In the third quarter, manufacturing declined 0.4 percent. That’s a sharper drop than the 0.3 percent estimated in the Oct. 27 GDP report.
A survey published by Markit this week showed factory growth picked up in October, though the data suggest sluggish expansion in recent months. A separate report from the Confederation of British Industry has pointed to weak export demand.