Share

British manufacturing output slumps

London - Britain's manufacturing output slumped by 1.5% in January compared with December, official data showed on Tuesday, dealing a fresh blow to the country's hopes of avoiding a fresh recession.

The wider measure of industrial production - which includes mining and quarrying, electricity, gas and water supply - dropped by 1.2% in January from December, the Office for National Statistics added in a statement.

Analysts' consensus forecast had been for manufacturing and industrial output to have each grown by 0.1% in January month-on-month, according to a survey by Dow Jones Newswires.

Industrial output fell as suspended production at the Schiehallion oil platform in the North Sea hit oil and gas extraction.

"January’s figures do little to ease fears that GDP may still be contracting and that the economy could therefore be in a triple-dip recession," said Capital Economics analyst Samuel Tombs.

Recent official data showed that British gross domestic product (GDP) shrank by 0.3% in the final quarter of 2012, compared with the previous three months.

Another contraction in the current first quarter of 2013 would place the British economy in its third technical recession since the 2008 global financial crisis.

"Industrial production measure fell 1.2% month-on-month in January, a far worse outturn than expected," said Royal Bank of Scotland economist Ross Walker.

"The slump in January leaves a decline in first-quarter GDP looking more likely than not."

In a separate data release on Tuesday, the ONS also revealed that Britain's trade-in-goods deficit narrowed at the start of the year.

The deficit shrank to £8.2bn in January from £8.7bn in December.

That beat analysts' forecasts for a January deficit of £8.9bn.

However, IHS Global Insight economist Howard Archer argued that the improvement masked a worrying trend.

"On the face of it, the sharply reduced trade deficit in January is better news for hopes that the economy can grow in the first quarter," Archer said.

"But even here the headline figure masks some worrying trends as the reduced deficit occurred because UK imports fell more than exports. This indicates that UK exporters are currently still finding life very tough while domestic demand is weak."

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.94
-0.9%
Rand - Pound
24.10
-0.9%
Rand - Euro
20.59
-0.7%
Rand - Aus dollar
12.42
-0.9%
Rand - Yen
0.13
-0.8%
Platinum
915.75
-0.8%
Palladium
1,028.36
-3.5%
Gold
2,159.96
+0.2%
Silver
25.03
-0.6%
Brent Crude
85.34
-0.1%
Top 40
66,252
0.0%
All Share
72,431
0.0%
Resource 10
53,317
0.0%
Industrial 25
100,473
0.0%
Financial 15
16,622
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders