- Howard Archer from IHS Economics
UK manufacturing production declined unexpectedly in October, signalling a weak start for the industry in the final quarter of the year. Output of British factories dropped 0.4% on the month in October, following a 0.9% increase in September, the Office for National Statistics reported. The biggest contributor to the decrease appeared to be other manufacturing and repair sub-sectors, within which the drop in repair and maintenance of aircraft and spacecraft was the largest downward drag, plummeting 21.5% on a monthly basis. In annual terms, manufacturing output was 0.1% lower compared with October 2014. Overall industrial production climbed as expected 0.1% in the reported month. Nevertheless, industrial output is still almost 9% below its pre-downturn peak in early 2008. Manufacturing output is around 6.1% below its peak.
Markit's headline PMI measure of business activity in UK factories declined in November to 52.7 from a 16-month high of 55.2 in October, as output and new orders rose at a slower pace. Yet, the overall activity so far in the final quarter of the year remained stronger compared with the preceding three-month period. Markit's report also showed little change in the employment level in UK factories following robust job creation in October.
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