British industrial output unexpectedly fell at its sharpest pace in five months in August, official figures showed this morning.
The Office for National Statistics said that total industrial output fell 0.9% in August - the biggest fall since March - as oil and gas production declined sharply following routine maintenance work and a fire in one oil field. Analysts had predicted a 0.2% monthly rise in output.
The ONS said that even if production rebounded by 1% in September as seemed 'reasonable', the sector would cut third quarter economic growth by 0.15 percentage points.
The Bank of England has said it expects the economy to expand by roughly the same 0.5% pace in the third quarter as it did in the second.
Manufacturing output also fell unexpectedly, by 0.2%. That was the first decline since March and meant output was 0.1% lower than a year earlier.
Meanwhiel, further signs of a pick-up in the British housing market emerged today, after Halifax said property prices increased by 1.2% in September.
The monthly gain resulted in an increase of 1.8% for the past three months - the biggest quarterly rise for a year, the mortgage bank added.
The Halifax said the lift in monthly house price inflation was consistent with a recent rise in activity levels, although the 3% annual rate of growth was still well down on the 20.5% recorded in the same quarter of 2004.
Halifax chief economist Martin Ellis said the Bank of England's decision to cut interest rates in August appeared to have given the market a boost. But he ruled out another boom in prices, even though household income remained healthy and high levels of employment supported the market.
