Manufacturing continues to improve and will help return the UK's economic output to growth, according to a new report.

Output among manufacturers is rising, with more businesses expecting healthy order books in the coming months, said BDO.

The business advisers said that in contrast to manufacturing, the services sector continues to contract.

Peter Hemington, of BDO, said: "Amidst slowing growth in the economy as a whole, UK manufacturing is a definite bright spot at the moment.

"However, our sense is that the recovery is weakening month-on-month.

"Given the continuing ability of the UK to create jobs at a surprisingly fast rate and the continuing relatively high levels of inflation, we can understand the calls for a hike in interest rates."