UK manufacturing output gained momentum in October, signaling robust recovery at the start of the fourth quarter. On the other hand, industrial production dipped unexpectedly led by a fall in oil and gas extraction.
Manufacturing output grew 0.6% in October from September, logging the strongest expansion since March, according to figures released by the Office for National Statistics on Tuesday. The growth rate exceeded September's 0.2% rise as well as the consensus forecast of 0.3%.
Manufacturers have largely benefited through this year from healthier demand both at home and overseas, improved competitiveness in both domestic and foreign markets stemming from the weak pound and a major rebuilding of stocks after they had been slashed during the recession, said IHS Global Insight economist Howard Archer.
Annually, manufacturing output rose 5.8% in October, up from the revised 4.9% increase seen in the previous month. Lifted by machinery and equipment production, manufacturing output was better than the expected 5.4% growth.
Output increased in ten of the 13 sub-sectors and fell in three on an annual basis. The largest contributors to the increase were the machinery and equipment industries, where production increased by 16.8%.
Meanwhile, industrial output fell 0.2% month-on-month in October, in contrast to a 0.4% rise in September. Economists were expecting a monthly growth of 0.3%.
Mining and quarrying output dropped 4.2% with a 4.2% decrease in oil and gas production. Energy supply output was down 1% on the month with decreases in electricity and gas supply output, data showed.
Year-on-year, overall production in October was 3.3% higher than in the same month last year, smaller than the expected growth of 3.9% and the 3.8% increase in September.
It looks like industry is in a good position to help to offset some of the effects of the looming squeeze, commented Vicky Redwood, an economist at Capital Economics. "But as have warned before, the sector isn't big enough on its own to keep the recovery going as the public and consumer sectors retrench," she said.
Recent surveys also provided an upbeat picture about the British manufacturing activity. According to the Engineering Employers Federation-BDO LLP Manufacturing Outlook survey, the UK manufacturing sector is powering ahead into the end of the year. The group predicted manufacturing to grow 3.8% this year before easing back slightly to 3.2% in 2011.
British manufacturing activity reached a sixteen-year high in November, the latest Purchasing Managers' survey from Markit Economics and the Chartered Institute of Purchasing and Supply showed. Production growth was recorded for the eighteenth successive month, which was also the fastest since May.
Lifted by global demand, the economy grew by 0.8% in the third quarter. But the Office for Budget Responsibility projects the recovery to be sluggish next year after expanding by an estimated 1.8% this year.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.