HOPES that Britain will avoid a triple-dip recession were boosted when figures showed output from the manufacturing sector rose last month at its fastest pace since 2011.
The latest Markit/CIPS purchasing managers’ index (PMI) showed overall activity expanded thanks to the rise in output, with a headline reading of 50.8 in January – above the 50 level that separates growth from contraction for the second month in a row.
While this was down on the 51.2 reading in December, it came despite last month’s snow and bad weather.
The sector was a drag on the wider economy at the end of last year, contributing to worse-than-expected 0.3% decline in gross domestic product (GDP) in the fourth quarter of 2012.
But the latest manufacturing report suggests the worst is over for the sector.
James Knightley, economist at ING Bank, said the report “offers hope that the GDP contraction in the fourth quarter will not be repeated in the first quarter of 2013“.