March 11, 2014 / 9:42 AM / in 4 years

UK manufacturing starts 2014 on good footing, weather hits oil and gas output

LONDON (Reuters) - British manufacturers started 2014 on a solid footing in January but bad weather caused the broader measure of growth in industrial output to slow sharply, official data showed on Tuesday.

Manufacturing output grew by 0.4 percent in January from December - despite a big fall in output in the pharmaceutical industry - and was 3.3 percent higher than in the same month last year, the Office for National Statistics said.

Economists in a Reuters poll had expected a month-on-month rise of 0.3 percent and a 3.3 percent increase for the year.

Overall industrial output, which includes power generation and Britain’s North Sea oil production as well as manufacturing, climbed 0.1 percent on the month, a sharp slowdown from growth of 0.5 percent in December.

The figure was slightly weaker than a forecast of 0.2 percent in a Reuters poll of economists.

Compared with a year ago, industrial output was up 2.9 percent, the ONS said.

Extraction of oil and gas was down 5.8 percent in January compared with December. Bad weather impeded production among several companies, the ONS said.

British finance minister George Osborne has said he will announce measures to help manufacturers when he delivers his annual budget statement next week.

The government has long sought to reduce the reliance of the economy on household spending but manufacturing output is still 9 percent smaller than when British economic output hit its peak before the financial crisis.

In the three months to the end of January - a smoother reading than the sometimes volatile monthly numbers - measures of manufacturing and overall industrial production were both up 0.7 percent compared with the previous three months, picking up a bit of speed.

Britain’s factory sector had a strong February when it grew more than in any other leading European economy, according to a survey of purchasing managers published last week.

Reporting by William Schomberg and Kate Holton

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