- LONDON: British industrial output grew at its slowest annual pace in four months in November, dragged down by weakness in the oil and gas sector, despite strength in manufacturing, official data showed on Thursday.
The figures drew no lasting market reaction as the key manufacturing component was broadly in line with recent private sector surveys, and did little to influence the debate about when UK interest rates would rise.
Industrial output rose 0.4 percent on the month after October's 0.1 percent decline. However, that was a smaller rebound than the 0.6 percent analysts had expected, and annual output growth slowed to 3.3 percent from 3.5 percent in October.
Manufacturing output grew slightly faster than forecast, helped by strong growth in car production and food processing. The 0.6 percent monthly rise matched October growth that was the strongest since March.
The strong manufacturing figures chime with recent industry surveys showing exports gave the sector a strong boost at the end of last year, although leading indicators have suggested the economy is now slowing sharply.
"It is heartening to see dynamism in this sector of the economy," said Brian Hilliard, UK economist at Societe Generale.
"It doesn't indicate any action at the Bank of England rate decision today. It is encouraging and it is genuine, but it is not enough to guarantee strong growth."
Surveys suggest Britain's service sector — which makes up about three-quarters of output — slowed at the end of 2010 and is likely to face further headwinds in 2011 as higher taxes and public spending cuts take their toll.
A breakdown of Thursday's data showed that industrial production was depressed by oil and gas output which dropped 0.7 percent on the month, its second consecutive fall . On the year, output in the sector fell 8.8 percent, its biggest annual decline since July.
The ONS said disruptive maintenance work on North Sea oil rigs appeared to have lasted longer in 2010 than in previous years.

