UK factory output recovers in February

The Office for National Statistics (ONS) today revealed UK industrial output recovered in February after the slump experienced in January.

According to the ONS, output grew by 1.3% in February after the 1% fall in January - boosted by an increase in production of food and drink, electrical and optical equipment as well as bricks and cement.

On an annual basis, output was up 1.3% - the highest since February 2008.

Commenting on the figures, RBS economist Ross Walker, said: “The risks of a double dip seem to be receding quite sharply. It looks at the moment like we will broadly maintain the pace of economic expansion we saw in Q4 and hopefully the composition will be better.”

The figures come after a positive week for UK economic news. Yesterday, the Organisation for Economic Co-operation and Development (OECD) said the UK economy will outperform its G7 rivals in the second quarter of 2010.

The forecast comes despite the UK economy lagging behind other major economies and being one of the last to emerge from recession - in the fourth quarter of 2009.

Furthermore, leading business group, the British Chambers of Commerce (BCC) said a double-dip recession had been avoided in the first quarter and the recovery was “still on course”.

In related news today, the Halifax revealed a 1.1% rise in house prices for the month of March compared with February.

The latest house price rise takes the annual increase to 5.2% from 4.5% the previous month, with the average UK home costing £168,521, almost £11,000 higher than this time last year.

According to the Halifax, the annual rate of price inflation is now at its highest since December 2007.

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