UK manufacturing picks up after summer shutdowns at car plants

But compared with August last year, manufacturing output was down 0.8 per cent, something that will be noticed by the Bank of England which is expected to say today that it is keeping interest rates at a record low.

Manufacturing rose by a monthly 0.5 per cent, above economists’ average forecast of a 0.3 percent rise. It had plunged by 0.7 percent in July, when output was hit by earlier than usual summer shutdowns of car plants.

Britain’s factory sector has lagged the broader recovery in the economy since the financial crisis and it has struggled more recently in the face of slower demand in key export markets and after a strengthening of sterling.

Underscoring the weakness in the global economy, German industrial output fell in August at its fastest pace in a year, the country’s Economy Ministry said earlier on Wednesday.

In the three months to August, which smooths out volatile monthly data, British manufacturing output was down 0.9 per cent compared with the previous three months, a slightly softer fall than in July, the Office for National Statistics said.

Britain’s economy grew by nearly 3 per cent in 2014 and started this year strongly too. But quarterly economic growth is expected to slow to about 0.5 per cent in the July-September period, down from 0.7 per cent earlier in 2015.

Wednesday’s data showed overall industrial output, which includes Britain’s oil and gas sector, rose 1.0 per cent in August compared with July, leaving production 1.9 per cent higher than a year earlier.

Those figures were boosted by seasonal adjustments in the ONS calculations which factor in shutdowns and maintenance work in the North Sea petroleum sector which did not take place on a large scale this year. There was also a small rise in gas production, the ONS said.

A private-sector survey of purchasing managers published last week showed that British factory output cooled further in September and manufacturers trimmed staff levels for the first time in more than two years.