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GB: Industrial Production
| Actual | Previous | Revised | |
| Industrial Production - M/M | -0.9% | 1.1% | 1.3% |
| Industrial Production - Y/Y | 0.5% | 2.3% | |
| Manufacturing Output - M/M | -0.5% | 2.1% | 1.9% |
| Manufacturing Output - Y/Y | 0.5% | 2.1% |
Highlights
December 2025 marked a clear loss of momentum in UK production, with output contracting by 0.9 percent after two consecutive months of robust expansion based on their revisions (October: 1.7 percent; November: 1.3 percent). The reversal suggests that late-year industrial strength proved difficult to sustain.
The decline was broad-based. All four major production sectors registered monthly falls: manufacturing slipped 0.5 percent, electricity and gas fell 1.7 percent, water supply and sewerage dropped 2.4 percent, and mining and quarrying declined 0.7 percent. Such synchronised weakness indicates systemic cooling rather than a sector-specific shock.
Within manufacturing, the picture was particularly telling. Eight of the thirteen subsectors recorded contraction, with sharp pullbacks in basic pharmaceuticals (minus 2.6 percent), food products (minus 1.4 percent), and chemical products (minus 5.0 percent). The weakness in chemicals is especially significant given its upstream role in industrial supply chains, potentially signalling softer intermediate demand.
Yet the annual comparison offers perspective as production and manufacturing output remained 0.5 percent higher than a year earlier. This implies that December's fall reflects short-term volatility rather than structural deterioration. The latest data point to an economy transitioning from autumn acceleration to winter consolidation. Growth has not reversed, but the pace has clearly moderated.
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.