HOPES of a pick-up by the troubled manufacturing sector were dealt a blow last night by figures for September showing an unexpected fall in output.

Factory output fell by 0.3 per cent on the previous month - the second consecutive monthly decline.

The latest figures from the Office for National Statistics (ONS) offset the optimism in a report from the Chartered Institute of Purchasing and Supply (CIPS) last week.

The CIPS said manufacturing in the UK grew at its sharpest rate of the year last month.

However, experts at ING Bank said the data came too late to influence the Bank of England's decision on interest rates this week.

ING said: "Given some better UK data of late, we now expect the bank to leave rates on hold at their current 4.5 per cent on Thursday."

The ONS said the most significant decrease in manufacturing output was 1.6 per cent in the chemicals and man-made fibres industries. There were no significant increases in any areas.

Manufacturers have suffered this year from the strength of the pound, weak growth in Europe and intensifying competition from Asia that has limited the scope for price rises.