U.K. manufacturing expanded for second month

Activity at the U.K. manufacturing sector expanded for the second consecutive month in January, raising hopes the economy can avoid a fall into a new recession, even though the activity grew less than a month before and was below expectations. According to the Markit Economics and the Chartered Institute of Purchasing and Supply, a gauge of factory activity was stood at 50.8 this month, compared with a revised 51.2 in December. Despite the slowdown from a previous month, a reading still remains above the 50 threshold, which separates growth from contraction. The U.K. economy shrank by 0.3% in the final three months of 2012, so the fact that Markit's factory index remains above 50 is an encouraging start to 2013.

"A second consecutive month of improving business conditions in the manufacturing sector is an encouraging start to 2013," said Rob Dobson, who compiles the survey for Markit.