| Consensus | Actual | Previous | Revised | |
|---|---|---|---|---|
| Industrial Production - M/M | 0.0% | 0.0% | -0.7% | -0.5% |
| Industrial Production - Y/Y | 1.1% | 1.5% | 1.3% | 1.5% |
| Manufacturing Output - M/M | 0.3% | 0.1% | -0.8% | -0.7% |
| Manufacturing Output - Y/Y | 3.1% | 3.0% | 2.8% | 3.0% |
Highlights
Industrial production was again soft at quarter-end. A flat monthly reading followed falls in both July and August but at least matched the market consensus. Annual growth was also steady at 1.5 percent.
Manufacturing fared only marginally better, posting a minimal 0.1 percent monthly increase after a 0.7 percent decrease previously. The gain here reflected rises in only five of the 13 subsectors, most notably computer, electronic and optical products (2.8 percent) and machinery and equipment (2.7 percent).
Elsewhere, total industrial production was boosted by a 1.4 percent advance in water supply and sewerage but hit by falls in mining and quarrying (2.2 percent) and electricity and gas (0.5 percent).
The September data leave overall third quarter industrial production unchanged from its second quarter level and manufacturing output just 0.1 percent firmer. Demand remains soft and although firms have made solid progress unwinding overblown inventories, prospects for the current quarter remain poor. That said, with the UK RPI now at 17 and the RPI-P at 12, at least economic activity in general is performing slightly more strongly than expected.
Manufacturing fared only marginally better, posting a minimal 0.1 percent monthly increase after a 0.7 percent decrease previously. The gain here reflected rises in only five of the 13 subsectors, most notably computer, electronic and optical products (2.8 percent) and machinery and equipment (2.7 percent).
Elsewhere, total industrial production was boosted by a 1.4 percent advance in water supply and sewerage but hit by falls in mining and quarrying (2.2 percent) and electricity and gas (0.5 percent).
The September data leave overall third quarter industrial production unchanged from its second quarter level and manufacturing output just 0.1 percent firmer. Demand remains soft and although firms have made solid progress unwinding overblown inventories, prospects for the current quarter remain poor. That said, with the UK RPI now at 17 and the RPI-P at 12, at least economic activity in general is performing slightly more strongly than expected.
Market Consensus Before Announcement
Industrial production is expected to be unchanged in September following declines of 0.7 and 1.1 percent in August and July.
Definition
Industrial production measures the physical output of the mining and quarrying, manufacturing, gas and electric, and water supply and sewerage sectors. Manufacturing is seen as the best guide to underlying developments as the other subsectors can be highly volatile on a short-term basis. Estimates are largely based on a monthly business survey of roughly 6,000 companies.
Description
Industrial and manufacturing outputs are watched carefully by market participants despite the decline in the importance of manufacturing in the UK economy. Manufacturing output is the preferred number rather than industrial production which can be unduly influenced by electrical generation and weather. The manufacturing index is widely used as a short-term economic indicator in its own right by both the Bank of England and the UK government. Market analysts also focus on manufacturing and its sub-sectors to get insight on industry performance.
Industrial production accounts for less than 16 percent of the economy within which the key manufacturing sector is worth about ten percentage points. Total manufacturing is divided into thirteen sub-sectors, ranging from food, drink and tobacco through chemicals and chemical products to electronics and transport equipment. Consequently, this report has a big influence on market behavior. In any given month, one can see whether capital goods or consumer goods are growing more rapidly. Are manufacturers still producing construction supplies and other materials? This detailed report shows which sectors of the economy are growing and which are not.
Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that won't lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios.
Industrial production accounts for less than 16 percent of the economy within which the key manufacturing sector is worth about ten percentage points. Total manufacturing is divided into thirteen sub-sectors, ranging from food, drink and tobacco through chemicals and chemical products to electronics and transport equipment. Consequently, this report has a big influence on market behavior. In any given month, one can see whether capital goods or consumer goods are growing more rapidly. Are manufacturers still producing construction supplies and other materials? This detailed report shows which sectors of the economy are growing and which are not.
Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that won't lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios.
