UK factory production growth slowed last month as inflationary pressure rises

By the Editorial Team · Friday, October 2, 2026

UK factory production grew modestly in September, with the manufacturing PMI rising slightly to 51.9 despite ongoing supply chain challenges contributing to inflation worries. In related economic developments, E.On's approved acquisition of Ovo will create the largest electricity supplier in Britain, while Land Securities' £516 million purchase of the Metrocentre highlights continued investment in retail real estate amid improved housing affordability.

Growth in UK factory production slowed in September as supply chain pressures contributed to rising inflationary concerns, according to a recent survey. The S&P Global UK manufacturing Purchasing Managers’ Index (PMI) showed an increase to 51.9 last month, up slightly from 51.7 in August. A reading above 50 indicates expansion, marking the eleventh consecutive month of growth in the manufacturing sector, though at a more subdued pace.

In a separate development within the energy sector, Britain’s Competition and Markets Authority (CMA) has approved E.On’s acquisition of rival energy supplier Ovo. The regulator had been assessing whether the merger would reduce competition in the UK energy market. E.On agreed to acquire Ovo in May, with reports estimating the value of the deal at around £600 million. The completion of the transaction is expected before the end of the year, positioning E.On as the country’s largest electricity supplier.

Meanwhile, in the real estate market, London-listed Land Securities (Landsec) announced it has agreed to purchase the Metrocentre shopping complex in Gateshead, Tyne and Wear, for £516 million. Landsec plans to raise £500 million through an equity fundraiser to finance the acquisition. The company, already a majority owner of large retail destinations such as Bluewater in Kent and Liverpool One, confirmed it has exchanged contracts to buy the entire Metrocentre from Tynehawk Holding. Tynehawk became the owner following the collapse of the previous owner, Intu, in 2020.

The housing market also showed signs of easing pressure on affordability, reaching its most favourable level in over a decade when comparing average home prices to wages. According to calculations by Lloyds Bank, the average UK home now costs approximately 7.3 times the average annual earnings, the lowest price-to-earnings ratio since 2015 and down from 7.6 a year ago. This improvement is attributed to wage growth outpacing increases in house prices over the past year. For first-time buyers, the ratio stands at 5.9, indicating a relatively improved, though still challenging, entry point into the housing market.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.