UK chems worse-performing industrial sector in May-July

LONDON (ICIS)–The UK’s chemicals industry suffered a fall in output of 4.8% in the three months to July amid “widespread weakness” in 11 of the 13 manufacturing sectors measured by the country Office for National Statistics (ONS).

Industrial production fell by 0.5% for the three months to July, compared to the previous three months.

Manufacturing (-1.1%) and mining and quarrying (-1.2%) posted declines, which were partially offset by rises in electricity and gas (2.8%) and water and waste (1.7%).

Month on month, however, industrial production expanded by 0.1% in July.
Petrochemicals in July, however, posted a fall of 6.3% in output, month on month, while production of soap detergents and cleaning products feel by 4.7%.

“Partially offsetting the overall strength and providing the largest downward contribution within manufacturing was chemical and chemical products, which fell by 3.1% [in June, month on month],” said the ONS.

GDP FLAT, DISPELS RECESSION FEARS
Wider economic indicators released by the ONS on Monday were more positive. GDP growth in the three months to July stood flat, after the country’s output had decreased 0.2% in the second-quarter (Q2).

With the Brexit process unresolved, some analysts had expected output to continue declining in the third quarter – a recession is official when GDP growth is negative for two consecutive quarters.

“While the largest part of the economy, services sector, returned to growth in the month of July, the underlying picture shows services growth weakening through 2019,” said the ONS’ head of GDP Rob Kent-Smith.

“The trade deficit narrowed due to falling imports, particularly unspecified goods (including non-monetary gold), chemicals and road vehicles in the three months to July.”