U.K. industrial output rebounded at a faster-than-expected pace in August, driven by oil extraction and transport equipment.
Industrial production grew 1 percent from July, reversing a 0.3 percent drop in the prior month, data from the Office for National Statistics showed Wednesday.
A similar rate of strong growth was last seen in February 2014. Economists had forecast only a 0.3 percent rise for August.
At the same time, manufacturing advanced 0.5 percent in August, partially offsetting a 0.7 percent fall in July. It was also faster than the expected 0.3 percent increase.
The latest monthly growth indicates effect of some earlier than usual shutdowns in the previous month.
Output of oil and gas extraction surged 8.7 percent and that of transport equipment climbed 4.6 percent.
On a yearly basis, industrial output growth accelerated to 1.9 percent in August from 0.7 percent in July. This was the fastest expansion since April 2014, when it climbed 2.4 percent, and also better than the 1.2 percent increase forecast by economists.
Meanwhile, manufacturing output continued to decline in August, largely due to a fall in machinery and equipment output.
Nonetheless, manufacturing output fell at a slower pace of 0.8 percent after decreasing 1.2 percent in July. Economists had forecast a 0.2 percent drop.
During the three months to August, industrial output advanced 1.3 percent, while manufacturing contracted 0.7 percent from a year earlier.
IHS Global Insight Economist Howard Archer said weakened manufacturing activity is worrying for hopes that UK growth can become more balanced and less dependent on the services sector and consumer spending.
Given that the recovery in the bigger services sector has lost some steam recently, overall GDP growth in third quarter still looks likely to have slowed from the second quarter’s 0.7 percent quarterly gain, Vicky Redwood, an economist at Capital Economics, said.
The recent Purchasing Managers’ survey from Markit showed that factory activity expanded at the weakest pace in three months in September. The pace of growth seen in the second and third quarters of this year have been weaker than seen earlier in the current growth sequence.
The International Monetary Fund on Tuesday raised its 2015 growth projection for the U.K. to 2.5 percent and the outlook for next year was retained at 2.2 percent.
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