Royal celebrations blamed for worst factory output in a decade
Sunday 05 August 2012
The worst performance in a decade for Britain's manufacturers will be confirmed this week as the Bank of England prepares to slash its growth and inflation forecasts.
The impact of the lost working day for the Diamond Jubilee is expected to send the sector's output plunging by 4.2 per cent over June, according to analyst forecasts. Tuesday's figures will mark the worst month for manufacturers since the Queen celebrated 50 years on the throne. Back then – in the context of a growing economy rather than a double-dip recession – manufacturing output shrank 5.6 per cent.
While the sector is expected to have bounced back in July due to the impact of an extra working day, a sustained recovery is not guaranteed. An alarming survey from the Chartered Institute of Purchasing & Supply showed the sector shrinking at its fastest pace for more than three years in July, casting an early shadow over the economy's overall growth.
Economist Osman Ismail of the Centre for Economics and Business Research said: "While turbulence in the eurozone accounted for most of this decline, there were also reports of decreasing orders from Asia. This is worrying, as extra-EU trade seems to offer the UK's best chance of export growth while European economies remain in such prolonged turmoil."
The eurozone crisis will also make its mark again in the Bank's latest quarterly forecasts on Wednesday. Analysts expect the Bank to slash its inflation forecasts in the wake of falling oil prices and a strengthening pound. The MPC is likely to project inflation falling below its 2 per cent target over the longer term, opening the door to more potential quantitative easing (QE) in the autumn.
Undertaker dead hoax: WWE legend not 'found dead in home' as Facebook and Twitter reports
South Korea ferry: Four dead and almost 300 missing as mass rescue gets underway
Malaysia Airlines MH370 co-pilot's phone 'was on and made contact with network tower' 30 minutes after plane turned around
Oscar Pistorius trial: Reeva Steenkamp told athlete she 'loved him' for first time in Valentine's Day card
Lunar eclipse 2014: Images of the spectacular 'blood moon'
David Cameron: 'Jesus invented the Big Society – I'm just continuing God's work'
US Navy christens huge $3 billion destroyer ship USS Zumwalt that appears as a fishing boat on enemy radar
The food poverty scandal that shames Britain: Nearly 1m people rely on handouts to eat – and benefit reforms may be to blame
Nigel Farage fatigue? Half of voters ‘immune’ to Ukip’s appeal
Scottish independence: It is the English who should be on their knees, begging the Scots to vote ‘No’
Nigel Farage on Have I Got News For You: Ukip leader ridiculed over expenses and party 'fruitcakes'
- 1 Refugee facing deportation from Sweden saved by fellow passengers refusing to let plane leave
- 2 Naked yoga: the bare truth - it's already big in the US, and has now landed here
- 3 Man on a leash in Farringdon, London: Mystery of 'walkies' solved
- 4 24 people applied for the 'world's toughest job', here are their interviews
- 5 Drugs giant GlaxoSmithKline bribed doctors to boost sales, says whistleblower
iJobs Money & Business
£40000 - £50000 per annum + BONUS + BENEFITS: Harrington Starr: A leading, Cit...
£35000 - £50000 per annum + Bonus + Benefits: Pro-Recruitment Group: You must ...
£45000 - £60000 per annum + BONUS + BENEFITS: Harrington Starr: Corporate Acti...
£350 - £400 per day: Harrington Starr: An opportunity has arisen at a FCA regu...