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Wednesday, 10 July, 2002, 09:51 GMT 10:51 UK
UK manufacturing picks up
Car production line
Manufacturing is still struggling to escape recession
Official figures show that UK manufacturing output edged higher for the second consecutive month in May, reinforcing hopes that the sector is firmly on the road to recovery.

Manufacturing production rose by 0.7% in May compared with April, the Office for National Statistics said on Wednesday.

The figures, which beat analysts' expectation of a 0.2% rise, mark the first back-to-back monthly increase in manufacturing output since October 2000.

In a further encouraging sign, the ONS raised its initial estimate of the increase in manufacturing production in April from 0.8% to 1.1%.

Fragile recovery

The manufacturing sector, hit by the global economic downturn and the strength of the pound against the euro, is only tentatively emerging from a year-long recession.

Earlier this month, a closely watched survey from the Chartered Institute of Purchasing and Supply showed that the sector's output barely increased during June, raising concerns that its recovery was at risk.

The ONS said manufacturing production was underpinned during the March to May period by a strong increase in output from the food, drink and tobacco industries.

However, the statistics agency warned that the government's decision to move the late May bank holiday to the first week in June is likely to have boosted the May manufacturing figures.

Weaker figures are expected for June, when normal business activity was disrupted by the extra Jubilee public holiday and the World Cup finals.

Will the UK economy feel the impact of the US slowdown?

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See also:

22 May 02 | Business
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