Britain's manufacturing base has continued to shrink.

The latest figures from the Office for National Statistics show manufacturing output falling by 1.6 per cent in September after an unexpected rise of 1.2 per cent in August.

Over the last three months manufacturing output was down 0.8 per cent, and fell 2.9 per cent year on year. The news increased speculation that the Bank of England may cut interest rates by 0.5 per cent on Thursday - a 0.25 per cent cut is already widely expected.