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Manufacturing output boosted by extra working day in May

Manufacturing output was unexpectedly boosted in May by an extra working day after the government postponed a public holiday.

However, a downward revision to previous industrial output and manufacturing numbers increased the risk that the overall economy shrank again between April to June, leaving Britain in recession with a third consecutive quarter of contraction.

Manufacturing output rose by 1.2 per cent in May after a 0.8 per cent drop in April, the Office for National Statistics said. Economists had forecast no change on the month.

A wider reading of industrial output, which includes energy production and mining, was 1.0 per cent higher in May after a 0.4 per cent drop in April and against forecasts for 0.2 per cent fall.

The ONS said a public holiday usually scheduled for the end of May was moved to June for the Queen's Diamond Jubilee, for which yet another extra holiday had been added.

Those two holidays will drag on June's production figures, leaving little chance that output rose on the quarter.

The figures overall echo a recent weakening in business surveys and come after the Bank of England announced plans last week to inject another £50 billion of stimulus into markets to boost demand.

Britain's trade deficit narrowed in May as exports rose, a separate release showed.

The goods trade deficit shrank to £8.363 billion in May from £9.709 billion in April, the ONS said. Economists had forecast a deficit of £9.0 billion.

Britain's economy sank back into recession at the start of the year and has suffered as a debt crisis rages through Europe, its main trading partner.

The growth stifling crisis has wreaked havoc across the continent and beyond, threatening to implode the common currency, and is so far showing few signs of abating.

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