For the first time in two years, manufacturing production rose last three months to January, riding on stock reductions and increased overseas demand for UK-made goods, employers' body CBI said.
Of the 461 manufacturers surveyed, 31 per cent said output rose during the three-month period, while 20 said it fell. The resulting balance of 11 per cent is the strongest figure since January 2007.
Export orders rose for the first time since January 2008, boosted by the relative weakness of the pound and improving global demand. Firms are continuing to de-stock, but at a slower rate, which also helped lift output.
Ian McCafferty, the CBI's Chief Economic Adviser, said: "After nearly two full years of falling output, manufacturers are seeing a return to modest growth, thanks in part to improved overseas demand and much slower stock reductions. Exports are rising for the first time in two years, and manufacturers are also feeling upbeat about export prospects for the year ahead."
He however cautioned that the manufacturing sector is "not out of the woods" and the UK's economic recovery will be slow and protracted.
CBI said that the future outlook remains uncertain, with domestic demand still weak, and some firms still struggling to access finance.