UK Industrial Production expected to rise 0.3% in May - RBS

By FXstreet.com | July 04, 2014 AAA

FXStreet (Łódź) - Ross Walker, Senior UK Economist at RBS, predicts that month-on-month UK Industrial Production data, due out next Tuesday, could rise 0.3% in May.

Key quotes

"Industrial production rose 0.4% m/m in April, taking the y/y rate up to 3.0% from 2.5% and growth in the latest 3 months up to 1.1% from 0.7%."

"The rise in April was underpinned by a 0.4% rise in manufacturing output – the fifth successive monthly rise, with a positive contribution from electricity, gas & steam being offset by declines in oil & gas and water supply."

"Survey evidence has remained positive, with the PMI output balance remaining at elevated levels in May. CBI industrial trends orders and output balances were barely altered in May (at relatively buoyant levels)."

"Similarly, the BoE Agents scores for manufacturing output were broadly maintained in May, with domestic activity more buoyant than the export-facing sector."

"We forecast IP to rise 0.3% m/m in May, taking the y/y rate up to 3.2% and leaving the sector on course to expand by 1.0% q/q in Q2."

"For manufacturing output, the risks appear skewed towards a slightly higher outturn (given the more-often-than-not drag from the energy components – in 7 of the previous 8 months)."

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