British industry had a blowout month in December

Pharmaceuticals drove a big gain in UK manufacturing during December.Tech Insider

LONDON – Industrial production in the UK grew 1.1% in the month of December keeping the UK’s industrial sector on the front foot after a bad few months, according to the latest data released by the Office for National Statistics on Friday.

The industrial production numbers compared favourably to the forecasts of economists, who predicted a smaller expansion of 0.2%. On a year-to-year basis, industrial production increased by 4.3% against a forecast of 3.2%.

“In December 2016, total production was estimated to have increased by 1.1% compared with November 2016; the only contribution to the increase came from manufacturing,” the ONS said in a release.

“Total production output for 2016 as a whole is estimated to have increased by 1.2%, with manufacturing providing the largest contribution, which increased by 0.7%.”

Effectively, British industry’s killer December was solely caused by a big increase in manufacturing, which was driven itself by a pick-up from the pharmaceuticals industry.

Here is the key extract from the ONS (emphasis ours):

“The increase in total production was due to broad-based increases in manufacturing. Pharmaceuticals (which can be highly erratic) provided the largest contribution to the growth, increasing by 8.3%. Other large contributions to the increase came from basic metals and other manufacturing and repair not elsewhere classified, which increased by 4.5% and 3.7% respectively.”

Here is the ONS’ chart, which shows the sharp growth for UK manufacturing in the month:

ONS

The pound, which had been trading lower, jumped on the release, climbing into positive territory for the day. Here is the chart:

Markets Insider