U.K. industrial production expanded in March but at a slower-than-expected pace as manufacturing logged a weak growth, while oil and gas extraction contracted from February.
Industrial production grew 0.3 percent month-on-month in March, reversing a 0.2 percent fall in February, the Office for National Statistics said Wednesday. Nonetheless, it was slower than the 0.5 percent rise economists had forecast.
Similarly, manufacturing output gained 0.1 percent, in contrast to a 0.9 percent decline in February. Economists had forecast a 0.3 percent increase.
Mining and quarrying output dropped 0.4 percent and oil and gas extraction slid 0.1 percent.
On a yearly basis, both industrial and manufacturing output contracted in March. Industrial production slid 0.2 percent, offsetting February's 0.1 percent increase, but was slower than the expected 0.4 percent decrease.
At the same time, the decline in manufacturing output came in at 1.9 percent, the biggest fall since May 2013, versus a 1.6 percent drop a month ago. The annual fall matched economists' expectations.
In the first quarter, industrial and manufacturing output decreased 0.4 percent each from the previous quarter.
Disappointing official industrial figures in March confirmed that the sector has slipped back into recession, leaving GDP growth precariously unbalanced, Ruth Miller at Capital Economics, said.
While Brexit uncertainty may be partly to blame, the sector's poor performance is certainly nothing new and many of the headwinds to growth in 2015 emanating from a weak global environment are still in place, the economist noted.
IHS Global Insight Economist Howard Archer said should the referendum result in a vote to leave the EU, it seems highly likely that the UK economy would suffer markedly for some time with negative repercussions for manufacturers – regardless of the long-term economic cases for and against EU membership.
by RTT Staff Writer
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