OUTPUT in Britain's manufacturing and construction industries unexpectedly fell in May, suggesting the UK economy has continued to stutter following a slowdown at the start of the year.
Figures from the Office for National Statistics (ONS) showed manufacturing output had fallen 0.2 per cent month-on-month in May, down from 0.2 per cent growth in April and below economists' expectations of a 0.3 per cent expansion.
The construction industry also endured a difficult month, failing to reverse April's 1.1 per cent decline by dropping 1.2 per cent in May against forecasts of 0.5 per cent growth.
Industrial production output - which includes areas such as manufacturing, mining and quarrying, and energy and water supply - dropped 0.1 per cent over the period when it was predicted to expand by 0.4 per cent.
While manufacturing's lacklustre performance proved the biggest drag on the sector due to the "highly volatile pharmaceutical industry", the ONS said a 0.8 per cent drop from energy supply had also pushed industrial production lower.
The warmest May for nine years saw gas supplies drop 1.5 per cent on the month, as demand for heating took a tumble.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the industrial production data increased the likelihood of the Bank of England's Monetary Policy Committee (MPC) keeping interest rates on hold at 0.25 per cent.
He said: "May's industrial production figures provide more evidence that GDP growth has not sped up in Q2, increasing the likelihood that the MPC stands pat next month.
"The fall in production partly reflected a 0.8 per cent month-to-month fall in output in energy supply sector, due to unusually warm weather; average temperatures were 1.8 degrees Celcius above their 1970-to-2016 May average.
"But manufacturing output also fell by 0.2 per cent, reversing April's increase. The flat trend in manufacturing contrasts with the bullish picture painted by surveys recently, although it is not unusual for the latter to be misleading."
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