UK manufacturing slumps as trade deficit with EU hits fresh record ahead of Brexit vote

Factory output fell 1.1 per cent in February compared with January, driven by a big drop in transport equipment. The ONS data showed just two of the 13 manufacturing sub-sectors expanded in February, reports The Telegraph.

Compared with a year earlier, the decline was -1.8 per cent, which represents the biggest drop since July 2013, according to the Office for National Statistics (ONS).

Economists had expected a much shallower annual fall of 0.1 per cent.

The ONS said total production output decreased by 0.5 per cent in February compared with the same month a year ago, the largest fall since August 2013.

Separate ONS data showed Britain’s trade gap in goods with the EU stood at £23.8bn in the three months to February, which is the widest since records began in 1998.

The ONS said this reflected a 1.3pc drop in exports and a 1.1 per cent rise in imports.

The UK economy grew by 0.6 per cent in the final three months of 2015. However, most economists expect the recovery to have slowed in the first three months of this year.

Closely-watched surveys of the manufacturing, services and construction industry this month suggest the economy expanded by 0.4 per cent in the first quarter.