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UK manufacturing sector shows signs of weakness

XM Markets UUIIFXBR
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UK data from the industrial sector on Tuesday showed signs that the British economy was not performing that well in the fourth quarter. Growth in manufacturing has been a lot weaker than the services sector. According to the Office for National Statistics (ONS), output is still well below 2008 levels.

Figures released for October showed industrial output contracted unexpectedly and manufacturing output tumbled by the most since May.

After having jumped by a revised 0.7 percent in September, industrial output fell 0.1% month-on-month in October, less than analysts’ forecasts for a 0.2% increase. On a year-on-year basis, output for industry rose 1.1% , less than an expected 1.8%. However this was more than the previous 0.8% rise.

With respect to manufacturing output, the October number also missed forecasts, as analysts expected a similar increase of 0.2% but instead there was a 0.7% decline month-on-month. On a year-on-year basis, the data also disappointed, giving a reading of a 1.7% increase versus 3.2% expected and less than the previous 2.2%.

According to the ONS, pharmaceutical and chemical goods also weighed on the factory sector.

Sterling fell to 1.5631 within a half hour of the data, which came out at 09:30 GMT, down from a high of 1.5693 before its release.

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