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.
- 1 Morgan Freeman on the riot-focused coverage of the Baltimore protests: 'F**k the media'
- 2 The man who filmed the Freddie Gray video has been arrested at gunpoint
- 4 Frankie Boyle on Scottish independence: 'In the Interests of Unity, F**k Off'
- 5 Length of pregnancy can vary by up to five weeks, scientists discover
Boston Marathon runner's search for mystery man she kissed ends with letter from his wife
Saudi Arabia's King Salman sacks senior aide for 'slapping' a journalist behind him live on TV
Frankie Boyle on Scottish independence: 'In the Interests of Unity, F**k Off'
Italian police 'reveal' what Jesus looked like as a young boy
Florida couple forced to register as sex offenders for having sex on public beach
In defence of liberal democracy
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
General election live: SNP suspends two members for disrupting Labour rally
Schools forced to act as 'miniature welfare states' with teachers buying underwear and even haircuts for poor pupils
Andy McSmith's Sketch: Feisty audience is the real star of an enlightening show
iJobs Money & Business
£20000 - £25000 per annum + Uncapped commission: SThree: Can you speak German,...
£25000 - £30000 per annum + benefits: Ashdown Group: An exciting opportunity f...
£215 per day: Ashdown Group: Junior Project Manager (website, web application ...
£40-50K: Guru Careers: We are seeking an experienced Software Engineer / Softw...