GDP flat in Q3 after factory output falls-NIESR

LONDON (Reuters) - The economic recovery stalled in the three months to September, the National Institute of Economic and Social Research said after official data on Tuesday showed a sharp drop in industrial output in August.

NIESR said GDP was flat in the third quarter following a modest expansion of 0.1 percent in the three months to August, an outturn it described as disappointing.

"Industrial production was much weaker than we expected in August," NIESR said. "In part this was because of reduced activity in the oil industry, which is known to be erratic. But the manufacturing sector showed further weakness as well."

The Office for National Statistics said industrial output, which accounts for some 17 percent of the economy, fell 2.5 percent in August, while manufacturing output was 1.9 percent down, leading some analysts to doubt the likelihood of a rebound in growth in Q3.

(Reporting by Fiona Shaikh; Editing by Ron Askew)