Manufacturing drives strong production growth

Strong growth in factory output drove a stronger-than-expected increase in production in the first quarter of 2019, official figures showed.

Manufacturing output rose 2.2% in the three months to March sending total production 1.4% higher - the strongest rise over three months since February 2017.

Monthly total production rose for the third straight period, gaining 0.7% in March, the Office for National Statistics said. The figure was stronger than the 0.6% rise in February and easily beat expectations for 0.1%.

Manufacturing was the biggest contributor, rising 0.9% with strong showings by pharmaceuticals, transport equipment and other manufacturing and repair. On average, economists had expected a rise of just 0.2%.

The surprisingly strong figures may have been supported by manufacturers building stocks before the original 29 March deadline for Britain leaving the EU. The ONS did not comment on this but other surveys of manufacturing activity have found companies hoarding raw materials and finished goods.

Tej Parikh, senior economist at the Institute of Directors, said: "Some businesses brought activity forward early this year in preparation for leaving the EU, so higher stocks and earlier orders have artificially bumped up the growth numbers. In the second quarter many firms will be keen to run down their Brexit caches, which will drag on economic growth."