London, United Kingdom (4E) – Manufacturing output in the UK expanded 1.4 percent in the first three months of the year, the strongest quarterly gain since 1999, according to data from the Office for National Statistics (ONS).
The result is a positive sign for the economy as construction output expanded by 5.4 percent in the quarter. The country’s trade deficit also dropped to 1.3bn British pounds in March, according to ONS.
In a separate report, research organization NIESR raised its growth forecast for the British economy to 2.9 percent in 2014, which is up from its earlier projection of 2.4 percent.
For 2015, NIESR increased its growth estimate to 2.4 percent from 2.1 percent, and forecasts growth to stay at around 2.4 percent for the succeeding two years. The higher-than-anticipated gain in manufacturing output was primarily driven by rubber and plastics, which climbed by 7.3 percent.
Food, beverages and tobacco, as well as machinery and equipment also contributed to growth. The biggest downward factor came from pharmaceuticals, which was down 5.8 percent.
The broader measure of industrial production increased by 0.7 percent in the quarter.
British Chambers of Commerce chief economist David Kern said that while the monthly figure had improved, the trade deficit for the first three months of 2014 had narrowed only slightly from the preceding quarter.