The UK produced some of the best growth figures of any Western industrialised nation last year and many expect it to repeat that performance in 2014. Optimists will be heartened by the latest UK industrial output figures which have come in at their best level of performance since early 2011. The broader-based figure for industrial output increased by 3% in April over the level seen twelve months previously whilst the narrower category of manufacturing output grew by 4.4% during the same period. These figures were the best levels of output seen in the UK since January and February 2011, respectively. UK output is now above the pre-crisis level asa whole.
The Office for National Statistics (ONS) noted that manufacturing output was up by 0.4% in April on a month-on-month basis. Demand for transport equipment, rubber and plastic materials and electronics helped to boost the figures. Whilst overall UK output is back above pre-crisis levels, ONS points out that industrial output and manufacturing output still have a long way to go to surpass the levels they enjoyed at the pre-crisis peak in Q1 2008, lagging these levels by 11.3 and 7% respectively.
The National Institute for Economic and Social Research (NIESR) is predicting that Q2 growth will come in at 0.9%, a similar level to Q1 which saw growth of 1.1%. If their estimate proves reliable, this would put GDP (as a Sterling value) about 0.2% above the figure seen in January 2008. NIESR is predicting that the UK economy will grow by 2.9% in 2014 and by 2.4% in 2015.
ONS will be changing the way that it calculates the GDP figure to bring the methodology in line with other major economies as an aid to comparability. The change will flatter the UK economy by revising the figures upwards. Details of the changes are to be given at the end of June.