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UK manufacturing records surprising shrink for May

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Data from the Office for National Statistics shows that the UK manufacturing sector shrunk 0.8 per cent in May.

The Office for National Statistics’s Index of Production, May 2013 also records an overall decline in manufacturing output of 2.0 per cent for the year
from May 2012 to May 2013.

The Guardian reports that economists expected the sector to grow in May by about 0.2 per cent.

David Tinsley from BNP Paribas told The Guardian that, "Overall, this is not a strong set of data and is a reminder that the surveys of manufacturing can often signal a different underlying picture to the monthly output data in the official sources.

"The momentum behind manufacturing remains disappointingly weak, which is troubling given the economy needs to do more to rebalance towards sectors where it can hope to find demand for its exports."

Mike Rigby, an analyst at Barclays, also said the results didn’t match expectations.

“Today’s figures feel a little out of kilter with other industry data and what our manufacturing clients are telling us," he told The Telegraph.

The Markit/CIPS UK PMI for June, for example, recorded a result of 52.5, far above 50, which separates expansion from contraction.

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