The slump in sterling after the Brexit vote failed to stimulate demand for British exports in July as factories saw their worst slide in activity in a year amid the new economic uncertainty, new official data reveals today.
The manufacturing sector saw a 0.9 per cent contraction following June’s EU referendum. However, the Office for National Statistics (ONS) said that the wider industrial production sector unexpectedly rose 0.1 per cent in July when many City economists had expected a contraction.
Industrial production also takes in utilities, mining and quarrying. On the forex markets, the pound collapsed to 30-year lows against the US dollar and near-eight year lows against the euro after the Brexit vote, leading to speculation that it might boost UK exports.
But Kate Davies, a senior ONS statistician, said: “Production output in July was relatively flat with strong growth in oil and gas counterbalanced by weaker manufacturing.
“There seems to have been no immediate benefit to UK manufacturers from the devaluation of the pound.”