Industrial production is growing at the fastest rate for almost three years, helping to drive an increased rate of economic growth. Further stimulus from the Bank of England therefore looks increasingly unlikely, with new governor Mark Carney taking the helm of an economy that is on a rising tide.
The UK economy can and will get better. Yesterday’s consensus beating industrial production data suggest the sector will contribute positively to growth in the second quarter. But that contribution will probably fade again in the coming quarters before getting decisively better next year.
Even if overall production simply holds steady in May and June, output will be about one per cent higher in quarter two than in the previous quarter, improving on the first quarter’s feeble 0.2 per cent quarterly rise. So April’s figures bolster hopes that GDP growth in the second quarter will be quite strong.