United Kingdom: Industrial production contracts in January
March 12, 2013
In January, industrial output dropped 1.2% over the previous month. The reading contrasts both the 1.1% increase observed in December (previously reported: +1.0% month-on-month) and market expectations that had industrial production recording a 0.1% rise.
The reversal mostly reflects a contraction in manufacturing output, which swung from a revised 1.5% expansion in December (previously reported: +1.6% mom) to a 1.5% drop in January. The result undershot market expectations of a flat reading. Output in mining and quarrying as well as in water supply, sewerage and waste management also declined in January.
In annual terms, industrial production fell 2.9%, which came in below the 2.1% drop seen in December. Nevertheless, the trend is pointing upwards, with annual average growth in industrial production edging up from minus 2.4% in December to minus 2.3% in January.
FocusEconomics Consensus Forecast panellists project industrial production to contract 0.1% in 2013, which is down 0.2 percentage points over the previous month's forecast. For 2014, the panel anticipates growth in industrial production to rebound and expand 1.3%.