UK industrial production grows at fastest pace since 2012

Output in the British industrial sector grew at its fastest pace since 2012, figures released on Wednesday (8 June) by the Office for National Statistics (ONS) showed.

Industrial output increased 2% month-on-month in April compared with a 0.3% gain in March beating analysts' expectations for an unchanged reading. More importantly, the figure marked the largest monthly increased since July 2012, the ONS said.

Manufacturing output also increased at its fastest pace since July 2012, rising 2.3% month-on-month in April, compared with a 0.1% gain in the previous month. According to the ONS, the figures were boosted by the largest monthly increase in the pharmaceutical sector since February 2014. Large export orders in the industry drove output in the sector up 8.6% month-on-month.

Despite the strong performance, however, the manufacturing sector remains 6.4% below its pre-crisis peak and currently accounts for approximately 10% of British economic output.

Meanwhile, on a quarterly basis, industrial output marked its first gain of the year, rising 0.7% in the three months to April. The UK economy slowed down from 0.6% to 0.4% in the first quarter and could shrink to 0.2% in the current three months amid growing uncertainty over the European Union referendum.

However, analysts warned that while the figures provided a timely boost to the economy, it was still too early to determine whether the industrial sector had turned a corner.

"Manufacturers will be hit by a rising pound after a Remain vote, or lower business investment after Brexit," said Samuel Tombs, chief UK economist at Pantheon Macroeconomics.

"With surveys of manufacturers continuing to point to falling production, it's simply too soon to conclude that April's data mark a turning point in the industrial sector's decline."