There was more evidence today of a worsening UK economy after official data showed a bigger than expected decline in manufacturing output.

There was more evidence today of a worsening UK economy after official data showed a bigger than expected decline in manufacturing output.

The Office for National Statistics (ONS) said the sector's output fell 0.5% between April and May. Analysts had been expecting a 0.1% decline.

Paul Dales, UK economist at Capital Economics, said the data added to recent evidence that the UK economy was "perilously close to recession".

"The lower pound should mean that the manufacturing sector is the UK's shining light, but with output no higher than eight months ago, it seems that the global and domestic slowdowns are having more of an impact," he said.

There was a "significant" fall of 1.5% for machinery production, the ONS said, with "no significant" increases elsewhere in the manufacturing sector.

The wider measure of industrial production, which includes oil and utilities output, also showed a bigger monthly fall between April and May of 0.8%.

Electricity, gas and water production provided the main downward pressure, falling 5.2%. The slump was blamed on warmer weather in May.

On an annual basis, manufacturing output fell 0.8% in May. During the latest quarter to May, the big dips were in rubber and plastic products, which fell 2.2%, and wood products, which dropped 1.5%.

Manufacturers have been hit in recent months by ballooning costs for oil - a raw ingredient for a host of products - as well as higher metals and food prices.

The ONS data is the latest in a series of gloomy surveys pointing to a slower economy.

Last week another manufacturing sector report showed activity in June falling to its lowest level since the aftermath of the 9/11 terror attacks. The Chartered Institute of Purchasing and Supply's (CIPS) manufacturing index for June fell to 45.8, with a score above 50 signalling growth.

Howard Archer, chief UK economist at Global Insight, said: "Sharply contracting industrial production heightens concern that the economic downturn is deepening."

But he said the slowdown nevertheless meant that an interest rate cut from the Bank of England was unlikely as rate-setters combat soaring inflation. The Bank's Monetary Policy Committee decides on Thursday what to do with base rates.

"An interest rate cut this Thursday remains a remote possibility, given the Bank of England's concern over current elevated inflation levels and risks," Mr Archer said.