Forex News – Sterling falls after UK manufacturing numbers unexpectedly drop
October 9, 2013 12:47 pm
Sterling weakened on Wednesday after disappointing UK manufacturing production data, which raised concerns about the health of the economic recovery in the nation.
According to a report released by the Office for National Statistics, the August figure was less than forecast since production fell from July.
Manufacturing Production dropped by a seasonally adjusted 1.2 percent in August, despite expectations for a 0.4 percent increase. In July production rose by 0.7 percent.
Meanwhile, on an annualized basis, manufacturing production declined at rate of 0.2 percent in August, which again missed expectations for a 1 percent gain. In the preceding month, annualized manufacturing production dropped at a rate of 0.3 percent.
GBPUSD dropped to a 3-week low of $1.595, down from yesterday’s high of $1.6259.
The following are some comments from economists showing their reaction to the data:
MIKE RIGBY, HEAD OF MANUFACTURING at BARCLAYS BANK “Today’s figures have come as a surprise, as our customers are demonstrating cautious optimism in terms of outlook. We have been seeing signs of recovery over the recent months, with increased levels of export activity and clients taking advantage of a strengthening domestic market.
“The fluctuations in data we are seeing will serve to remind the sector that while there is a general sentiment of optimism, we are some way from a full recovery.”
ROSS WALKER, RBS “(They’re) surprisingly bad, hugely at odds with the surveys which I think are equally dubious – I don’t think we’re expanding at anything like the pace that the PMIs tell us – and way below forecasts.
“I don’t think the reality is anything like as bad as this, and for the third quarter we will probably see the industrial sector growing by 0.6, 0.7 percent, so for the quarter as a whole still quite healthy growth.
Sterling weakened on Wednesday after disappointing UK manufacturing production data, which raised concerns about the health of the economic recovery in the nation.
According to a report released by the Office for National Statistics, the August figure was less than forecast since production fell from July.
Manufacturing Production dropped by a seasonally adjusted 1.2 percent in August, despite expectations for a 0.4 percent increase. In July production rose by 0.7 percent.
Meanwhile, on an annualized basis, manufacturing production declined at rate of 0.2 percent in August, which again missed expectations for a 1 percent gain. In the preceding month, annualized manufacturing production dropped at a rate of 0.3 percent.
GBPUSD dropped to a 3-week low of $1.595, down from yesterday’s high of $1.6259.
The following are some comments from economists showing their reaction to the data:
MIKE RIGBY, HEAD OF MANUFACTURING at BARCLAYS BANK
“Today’s figures have come as a surprise, as our customers are demonstrating cautious optimism in terms of outlook. We have been seeing signs of recovery over the recent months, with increased levels of export activity and clients taking advantage of a strengthening domestic market.
“The fluctuations in data we are seeing will serve to remind the sector that while there is a general sentiment of optimism, we are some way from a full recovery.”
ROSS WALKER, RBS
“(They’re) surprisingly bad, hugely at odds with the surveys which I think are equally dubious – I don’t think we’re expanding at anything like the pace that the PMIs tell us – and way below forecasts.
“I don’t think the reality is anything like as bad as this, and for the third quarter we will probably see the industrial sector growing by 0.6, 0.7 percent, so for the quarter as a whole still quite healthy growth.
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