U.K. Industrial Production Remains Flat; Construction Output Falls

(RTTNews) - British industrial output remained flat in November and construction output logged the sharpest decline so far in 2013, confounding recent survey data that underscored robust activity in the fourth quarter.

Industrial production remained unchanged in November compared with the previous month, the latest figures from the Office for National Statistics showed Friday.

The unexpected stagnation in production followed two successive months of improvement. Output increased by a revised 0.3 percent in October and 0.9 percent in September. Economists had forecast a 0.4 percent increase in November.

Manufacturing output also remained steady on a month-on-month basis. In October, factory output grew by a revised 0.2 percent. Economists had forecast a 0.4 percent increase.

Year-on-year, industrial production growth eased to 2.5 percent in November from 3.2 percent, while expectations were for a 3 percent rise. Manufacturing output grew 2.8 percent annually, slower than the expected 3.3 percent expansion and October's 2.6 percent rise.

Another ONS report showed that construction output, which accounts for 6.3 percent of gross domestic product, declined 4 percent in November from October. This was the sharpest fall in production in 2013.

Nonetheless, construction output rose 2.2 percent year-on-year, which was the sixth consecutive month of annual growth.

Taking all recent reports, the fourth quarter GDP is likely to come in just below 1 percent rather than just above, said ING Bank NV economist James Knightley.

Gross domestic product expanded 0.8 percent in the third quarter of 2013. The British Chambers of Commerce forecasts economic growth in the fourth quarter to accelerate to 0.9 percent.

Looking ahead, with a recovery in real incomes set to support further growth in consumer spending and signs that firms are gearing up to invest, 2014 should be a year of continued expansion in industrial production, said Samuel Tombs, a UK Economist at Capital Economics.