LONDON (Reuters) - Industrial output grew at its slowest annual pace since July in November, dragged down by continued weakness in the oil and gas sector and despite ongoing strength in manufacturing, official data showed on Thursday.
Industrial output rose 0.4 percent on the month after October’s 0.1 percent decline. However, that was a smaller rebound than the 0.6 percent analysts had expected. Annual industrial output growth slowed to 3.3 percent from 3.5 percent in October.
Manufacturing output grew slightly faster than forecast, matching October’s monthly rate of 0.6 percent which was the strongest since March.
The strong manufacturing figures chime with recent industry surveys showing growth in the sector at a 16-year high at the end of 2010, and will not alter expectations the Bank of England will keep interest rates at a record low of 0.5 percent later on Thursday.
Recent strong price data, however, has raised expectations that a UK rate rise is possible before the summer, and markets have shifted to price in two quarter-point rate hikes by the end of the year.
The ONS figures showed that oil and gas output fell for a second consecutive month, dropping 0.7 percent. On the year, output in the sector was down 8.8 percent, its biggest annual drop since July.
Within manufacturing, car production was up strongly in line with the big increase in car exports shown in Wednesday’s November trade data.