London: UK manufacturing growth unexpectedly accelerated in October and hiring improved as export orders increased.

A gauge based on a survey of companies by Markit Economics and the Chartered Institute of Purchasing and Supply (CIPS) rose to 54.9 from 53.5 in September, according to an e-mailed statement yesterday in London.

The median forecast of 25 economists in a Bloomberg News survey was for a decline to 53. A measure above 50 indicates expansion.

Manufacturing is gaining traction after a drop in the pound since the start of 2007 boosted demand for British exports, and economic growth in the second and third quarters was the strongest for two consecutive quarters since 2000. Still, the Bank of England will probably keep its asset-purchase programme at £200 billion (Dh1.18 billion) this week as the government prepares the biggest public-spending cuts since Second World War.

"Exports are very much the engine of growth within manufacturing at the moment," David Noble, chief executive officer at CIPS, said in the statement.

"It's difficult to predict the impact of fluctuations in export markets so the recovery may continue to be bumpy. What is clear is that manufacturing looks set to drive further gross-domestic-product growth in the fourth quarter."

The pound rose as much as 0.3 per cent against the dollar after the report was published, and traded at $1.6086 as of 9:32am in London.

Glasgow, Scotland-based Weir Group Plc, the world's biggest maker of pumps for the mining industry, said yesterday it expects profit for the fiscal year 2010 will be slightly ahead of previous forecasts.

New export orders rose at the fastest pace in five months in October, CIPS said, with companies reporting sales increases to Europe, Latin America, the Middle East and Africa. Employment rose at the fastest pace since June, while average input costs rose for a 14th month.

The UK economy grew 0.8 per cent in the third quarter, double the forecast of economists in a Bloomberg survey.

"This report confirms that the improving picture painted by last week's good GDP data has continued into the final quarter," James Knightley, an economist at ING Financial Markets in London, said.