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BCC: Manufacturing improvement is welcome but recovery still faces threats

Commenting on the July manufacturing output figures, published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:

“The larger than expected increase in July manufacturing output supports our assessment that the third quarter of the year may show a return to economic growth. However, the manufacturing sector is still facing serious problems and longer-term comparisons show big falls.

“The early stages of any upturn will be driven by a turnaround in stock levels, so it is important to maintain and reinforce the stimulus provided by quantitative easing. Recent falls in bank lending to non-financial firms are worrying and it may be necessary for the MPC to consider additional measures.”