Surprisingly bad manufacturing and production numbers out today in the UK are sparking fears of a triple-dip recession. Manufacturing output fell 0.3% in November from the previous month, according to figures (pdf) from the Office for National Statistics, while industrial production rose 0.3% from October, which was below forecasts. Experts had called for a better month given North Sea oil and gas production had resumed following a longer-than-expected maintenance period. The construction sector also disappointed with output contracting by 9.8% from November 2011.
The announcement today follows a slew of other bad UK news, including December numbers from the service sector showing a decline for the first time in two years, and word that the trade deficit, which shrank in November, will still weigh on GDP in the fourth quarter.
If UK GDP numbers for the fourth quarter show an economic contraction and that’s followed by contraction again in the current quarter, that would represent a triple-dip recession. (A recession is defined as two or more consecutive quarters of declining GDP). The UK was in recession from the second quarter of 2008 through to the second quarter of 2009, and again from the last quarter of 2011 through to the second quarter of 2012. Some believe things are headed that way again: