Tuesday, January 12, 2016

The latest industrial production statistics indicate continued growth in production. Compared with a year earlier, production in November 2015 was a little under 1% higher. This is, however, in spite of a large fall of 1.3% in manufacturing - the largest component of industrial production. This fall was compensated for by a substantial increase in other sectors, notably including oil and gas extraction.

I have regularly used these statistics to provide forecasts using a simple neural network programme. The latest forecasts, with the red line looking ahead 24 months, appear below. They continue to evidence some fragility in the production sector, with a dip in overall output over the coming period looking increasingly likely.