Some signs of life from troubled UK economy

By SCOTT REID
Published on Friday 10 February 2012 00:00

FRESH signs of resilience in the economy emerged yesterday after official figures revealed a surprise jump in factory output while Britain’s trade deficit posted a sharp improvement.

Manufacturing output rose by 1 per cent between November and December, much stronger than the increase forecast by analysts, according to the Office for National Statistics. While the sector still contracted in the last quarter of 2011, the performance in December builds on other recent surveys that have suggested trading conditions and confidence are slowly improving.

There was also encouragement in separate figures which showed the UK’s deficit on seasonally adjusted trade in goods was £7.1 billion in December, compared with £8.9bn a month earlier and more than £10bn in September. It marks the narrowest deficit since last April.

Think-tank the National Institute of Economic and Social Research yesterday said the economy contracted in the three months to January, matching the 0.2 per cent fall cited in its previous monthly estimate.

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