UK industrial output declines unexpectedly in September

According to data from the Office for National Statistics (ONS), industrial output in the UK declined unexpectedly in September due to production cuts caused by North Sea oil shutdowns. Industrial output was down 0.4% on the month, in line with August’s decline, missing analysts’ estimates which called for a steady trend from the previous month while it contracted by 0.5% in the third quarter.

Industrial output increased 0.3% on a yearly basis, missing economists’ expectations which called for a 0.8% rise. It is reported that mining and quarrying contracted by 3.8% on a monthly basis in September while manufacturing output increased 0.6%, exceeding forecasts which called for 0.4%.

On a yearly basis, manufacturing output rose 0.2% despite the forecasts which called for a 0.1% decline. However, the data shows that it dropped 0.9% in the third quarter.

According to the data, the UK economy grew 0.5% in the third quarter, exceeding forecasts calling for a slowdown in a survey by The National Institute of Economic and Social Research.

The institute forecasts that economic growth will increase 2% in 2016 and decelerate to 1.7% in 2017. Inflation is expected to increase to 3.8% at the end of 2017 due to the rise in imports’ costs driven by a weak pound.