U.K. Industrial, Manufacturing Output Better Than Expected in May
U.K. manufacturing and industrial output data comfortably exceeded expectations in May, countering worries about a sharp slowdown in second-quarter growth even before the impact of U.K.'s Brexit kicks in.
The Office for National Statistics said total industrial output rose 1.4% year-on-year, compared with 1.6% annual growth in April and expectations for 0.5% growth.
On the month, output contracted by 0.5%, but that was better than the 0.9% decline forecast.
The narrower measure of manufacturing output also showed annual growth of 1.7% that was more than double the 0.8% growth rate expected. The month-on-month 0.5% decline, as with the industrial output figure, also compared with forecasts for a slump of about 0.9%.
The smaller-than-expected monthly declines came after unexpectedly strong April data and may allay concern about a pre-Brexit economic slowdown.
Analysts at Markit this week predicted second-quarter GDP growth would halve to 0.2% from 0.4%. And Brexit, which appears inevitable after the June 24 victory for "leave" campaigners, is expected to shave national GDP in coming years.
IMF chief Christine Lagarde said this week Brexit could slice 1.5% to 4.5% from GDP by 2019.
Bank of England Governor Mark Carney said
The Office for National Statistics said the biggest contributor to industrial output growth was the manufacturing sector, led by makers of transport equipment.
The month-on-month output decrease was led by makers of basic pharmaceutical products and pharmaceutical goods, which posted a 6.5% decrease after a 9% surge in April.
The FTSE 100 held gains after the report and was recently up 1.53% at 6,562.17.