United Kingdom: Industrial output contracts in June amid fewer working days
August 7, 2012
In June, industrial production contracted 2.5% over the previous month in seasonally-adjusted terms. The figure contrasted the 1.0% increase observed in May but, nonetheless, surprised the market on the upside, as analysts expected industrial output to decline a sharper 3.5%. According to the Office for National Statistics (ONS), industrial output was affected by "the moving of the late May 2012 bank holiday to June 2012 and the additional bank holiday for the Queen's Diamond Jubilee". The contraction was mostly the result of a decline in the manufacturing sector, which swung from a 1.2% month-on-month expansion in May to a 2.9% contraction in June. That said, the reading was above market expectations, which had expected a steeper 4.3% decline. Compared to the same month last year, industrial output dropped 4.3%, which came in well below the 1.8% contraction seen in May and represents, in fact, the worst figure since November 2009. As a result, the trend continues to point downwards, with annual average growth in industrial output falling from minus 2.1% in May to minus 2.4% in June.