December industrial production boosts recovery hopes

British manufacturing output rose more than expected in December, boosting hopes the economy is on the road to recovery. The Office for National Statistics said today that manufacturing rose by 0.9% on the month, from an upwardly revised 0.2% in November. This was three times faster than economists had forecast. The broader measure of industrial production, which includes North Sea oil and gas output and accounts for 17% of the economy, also rose by slightly more than expected, growing by 0.5% on the month. Analysts had forecast a rise of 0.2%. Howard Archer, chief UK economist at research group IHS Global Insight, said: "Manufacturing output surged in December while November's performance was revised up to show a modest gain, thereby providing a very welcome boost to recovery hopes after some recent disappointments." He noted that industrial production grew by 0.4% quarter-on-quarter during the last three months of the year, rather than the 0.1% that had been estimated , and said it gave "a modest lift to hopes that overall GDP growth of 0.1% quarter-on-quarter could be revised up." The ONS said the figures implied an upward revision of less than 0.1 percentage points to the GDP estimate, other things being equal. Manufacturing was down 1.9% in the year to December and industrial production was down 3.6% during the same period.