Upbeat UK manufacturing activity in April does not herald a sustained near-term pickup

According to official figures, UK manufacturing output grew at the fastest pace for nearly four years in April. Manufacturing output grew by 2.3 percent in April, the biggest monthly rise since July 2012.

UK manufacturing activity surged in April, however, the underlying pace of growth remains modest. Even after April’s rise, output has risen by only 0.1 percent and 0.9 percent over the past three and twelve months respectively.  Manufacturing activity is still about 6 percent below its pre-recession level.

The official output figures contrast with recent surveys that had indicated weak growth in the manufacturing sector. The Purchasing Managers' Index survey from Markit/CIPS suggested manufacturing activity contracted in April, before recording slight growth in May. ONS also cautioned about reading too much into the buoyancy hinted at by the data.

Chris Williamson, chief economist at Markit, warned that the revival suggested by the official figures, could be short-lived. “The improvement in the official data also contrasts with deteriorating survey evidence on the health of the economy, and manufacturing in particular, in recent months, suggesting the April upturn may be reversed in May,” he said.