On a 12-month basis, Britain's manufactured output climbed 1.0 percent in May, the Office for National Statistics said. Analysts' consensus forecast had been for a monthly rise of 0.3 percent and annual increase of 0.9 percent. Manufactured output accounts for 14.7 percent of the British economy.
"There was a significant increase in the transport equipment industries, where output rose by 1.3 percent" in May, the ONS said. "There were no significant decreases in output during May. Within transport equipment, output from the ship building industry increased by 13.7 percent following the completion of several large contracts," it added.
The overall manufacturing index is now running at 103.1, the highest since August 2001 when it was at 103.6. The sector's continuing recovery suggests that five interest-rate rises since last August is yet to have an impact, analysts said.
The Bank of England recently lifted its key interest rate by a quarter-point to 5.75 percent, the highest level for more than 6 years, in a bid to tame British inflation. The BoE's move had been widely anticipated by economists, after recent data revealed that Britain's economy had grown faster than expected earlier this year.
Meanwhile the ONS said that the wider industrial production measure, which accounts for 18.6 percent of the gross domestic product, increased by 0.6 percent in May from April. On a year-on-year basis, industrial production was 0.5-percent higher.