UK factory output up 0.9 pct in July, highest since Jan ’08

British manufacturing output rose at its fastest monthly rate in 1-1/2 years in July, helped by a sharp pick up in car production, official data showed on Tuesday.

The Office for National Statistics said factory output rose 0.9 percent in July — the biggest rise since January 2008 and triple analysts' expectations for a 0.3 percent increase.

The wider measure of industrial output, which includes energy production, rose more than twice as fast as expected, by 0.5 percent on the month. It fell 9.3 percent on the year.

The figures suggest Britain's economy has made a stronger start to the third quarter and is on track to emerge from recession before the year is out.

The ONS said July's gain in manufacturing was mainly due to gains in the transport sector, which was boosted by a 10.4 percent rise in motor vehicle production — the second monthly rise in a row.

The car sector has been helped in recent months by the government's car scrappage scheme which gives motorists a cash incentive to trade in their old cars for new ones.

Still, total manufacturing output was 10.1 percent down on the year.

June's readings for both manufacturing and industrial output were revised up slightly, but the ONS said that would have no material effect on second quarter GDP.