U.K. Manufacturing Shrank More Than Economists Forecast In January

, (PressExposure) April 15, 2009 -- U.K. manufacturing shrank over economists forecast in January & posted the biggest quarterly drop in at least one decades as the recession throttled demand for British goods from cars to machinery. Factory production dropped 2.9 percent from December, the Office for National Statistics said today in London. Economists predicted 1.4 percent, the median of 18 forecasts in a Bloomberg News survey shows. Manufacturing shrank 6.4 percent in the three months through January, the most since records began in 1968. The global slump is ravaging British manufacturing, forcing ministers from Gordon Brown's government to meet carmakers tomorrow to discuss a rescue plan. French industrial production plunged in January by the most in at least 19 years & italian exports fell for a fourth month, separate reports showed today. "This is unbelievably grim," Alan Clarke, a London-based economist at BNP Paribas SA, said in an interview. "There's no sign of the slowdown abating. The Bank of England will probably require to do more." British manufacturing has now dropped for 11 months, the worst streak of contraction since 1980, when Margaret Thatcher was prime minister. Factory production accounts for about 15 percent of the economy, compared with about 75 percent for services & 6 percent for construction. Production of motor vehicles & auto parts drove the slump in the transport category, the data showed. Out of 13 categories of manufacturing, nine fell & one rose on the month, the statistics office said. Transport equipment, electrical, optical goods, & machinery & equipment led the declines. French industrial production dropped 13.8 percent in January from a year earlier, the French statistics office said today, the biggest decline since the series began in 1990. italian exports declined 4.4 percent on the month. Europe car production will probably fall 25 percent & sales are likely to drop 20 percent this year, the European car Manufacturers Association said on March 5. U.K. Trade Minister Ian Pearson will set out how a 2.3 billion-pound ($3.2 billion) aid package for automakers will work & which companies will be eligible when they meets executives tomorrow. The government is considering separate help for General Motors Corp.'s Vauxhall unit.

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Press Release Submitted On: April 14, 2009 at 2:42 am
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