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UK manufacturers brave credit storm

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Date: Wednesday 09 Apr 2008

LONDON (ShareCast) - Britain’s manufacturing sector had the weak pound to thank for a bigger than expected increase in factory output growth in February, figures showed today.

Manufacturing output grew 0.4% during the month, according to the Office for National Statistics (ONS), better than the 0.1% economists had predicted.

That took the annual rate to 1.9%, the highest in over a year, and followed upwardly revised monthly growth of 0.5% in January.

The food, drink, tobacco, chemical and metal sectors were largely responsible for the improvement, said the ONS.

Sterling’s drop versus the euro, now down at an all-time low, saw 29% of production exported during the month, the most in almost seven years.

The industry also appears to be weathering the credit crunch that is impacting on both the housing and retail markets.

Meanwhile, the wider industrial output number came in 0.3% higher in February from the previous month, easily reversing January’s 0.1% drop. The annual rate is now 1.3%.