-NIESR
The British manufacturing production unexpectedly dropped in May, while total industrial output beat economists' expectations on the back of a strong growth in oil and gas extraction in more than a year. Manufacturing output declined by a seasonally adjusted 0.6% in May, whereas market participants had expected a 0.1% increase. Measured on an annualised basis, manufacturing production rose 1.0%, against the median forecast for a 1.8% gain, and following the 0.1% rise in April. The data also showed that industrial output climbed 0.4% in May, overshooting expectations for a 0.2% decrease. The extraction of oil and gas surged 7.3%, the biggest growth since February last year, when it soared by 10.5%. Mining and quarrying also recorded a strong growth of 4.9%. The British economy continued to expand steadily in the second quarter, but remained overly reliant on the services sector, which accounts for around 78% of the total economic output. At the same time, growth in manufacturing sector significantly lagged behind, suggesting uneven economic growth. After expanding at the 0.4% rate in the first quarter, the economy is expected growing at between 0.5% to 0.6% in the second quarter.
Britain's economy accelerated speed in the second quarter after a slow start to the year, growing 0.7% from the first quarter, according to NIESR. In annual terms, growth was 2.7%.
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