UK manufacturing enjoys strong quarter
UK manufacturing output grew by 1.4% in the first quarter of the year, the strongest quarterly pace since 1999, Office for National Statistics (ONS) figures show.
The was further good news for the economy as construction output grew by 5.4% in the quarter.
The ONS also said that the UK trade deficit fell to £1.3bn in March.
Separately, research organisation NIESR upgraded its growth forecast for the UK economy to 2.9% in 2014.
This was up from its previous estimate of 2.4%.
NIESR also increased its growth estimate for 2015 to 2.4% from 2.1%, and sees growth remaining at about 2.4% for the following two years.
‘March of the makers’
The better-than-expected rise in manufacturing output was mainly driven by rubber and plastics, which grew by 7.3%.
Food, beverages and tobacco, and machinery and equipment also drove growth. The largest downward pressure came from pharmaceuticals, which fell by 5.8%.
The wider measure of industrial production increased by 0.7% in the quarter.
Martin Beck, senior economic adviser to the EY ITEM Club, said: “The ‘march of the makers’ continues.”
He noted that given recent upbeat manufacturing surveys in April, the second quarter of the year seemed “set fair for further strong growth in the manufacturing sector”.
The fall in March’s trade deficit was driven by a rise in exports, with exports of goods up 4.9% from the month before while imports of goods rose 2.8%.
However, David Kern, chief economist at the British Chambers of Commerce noted that while the monthly figure had seen a big improvement, the trade deficit for the first quarter of 2014 had narrowed only slightly compared with the previous quarter.
“While there are signs of a small improvement in the UK’s international trade performance over time, the pace of change is still painfully slow,” Mr Kern said.