British manufacturing output rose for the first time in three months in November, while overall production picked up faster than expected, official data showed today.
The Office for National Statistics said factory output rose 0.3 per cent on the month, in line with forecasts and leaving it 2.4 per cent higher than a year ago.
Overall industrial output, which includes the energy sector, rose 0.5 per cent in November, 0.8 per cent higher on last year. That was the strongest monthly rate since March 2006 and above the 0.3 per cent increase predicted by analysts.
Sterling rose against the dollar after the data, but the figures did little to alter expectations the Bank of England will hold interest rates at 5 per cent at 12pm or settle the debate over whether borrowing costs will rise next month.
Money markets have priced in a rate rise in February and the risk of a further increase later in the year as the BoE seeks to tame above-target inflation, but economists remain divided over whether the next move for borrowing costs will be up or down.
The ONS said the underlying trend in manufacturing appeared to be positive even though output was only 0.1 per cent higher in the three months to November over the previous three months - the weakest rate in nearly a year.
While British manufacturing has benefited from the upturn in the euro zone economy, many companies are beginning to worry the strong pound is harming competitiveness and could end the sector's fledgling recovery.