Latest figures published today for the UK by the Office for National Statistics, show a decline in GDP for Q3 of 0.3%. This is an upward revision on the first estimate of a month ago, but not enough to take the UK out of a technical recession. At current prices and with a small amount of inflation in the system, GDP grew by 0.1%.
Looking more deeply into the results, we see strong variations in activity.
Wednesday, 25 November 2009
Thursday, 19 November 2009
Latest IMF forecasts revise GDP growth upwards for 2010
Today's IMF Economic Outlook provides some positive news for the global economy. Below is a short overview from Jorgen Elmeskov, Acting Chief Economist at the OECD.
Higher growth than previously expected for next year, but for some the legacy of high unemployment will provide a drag on the speed of the recovery. Is that a hint of a wry smile when he seems to suggest that the US, having shed labour rapidly, will bounce back more quickly than labour hoarding EU companies and countries?
Overall the OECD economies are set to grow over the year, with the exception of Greece who will face a small decline in 2010, and the non OECD world is set to bounce back more rapidly.
Unemployment in the EU is set to hit double digit figures exceeding 10% for the next two years. Eight countries are set to stay above 10% with Spain (19.3%), Turkey (15.2%) and Ireland (14%) likely to struggle for some time yet in returning to strong expansion.
A summary of the forecasts is provided on the OECD website with detailed assessments of individual countries too.
Higher growth than previously expected for next year, but for some the legacy of high unemployment will provide a drag on the speed of the recovery. Is that a hint of a wry smile when he seems to suggest that the US, having shed labour rapidly, will bounce back more quickly than labour hoarding EU companies and countries?
Overall the OECD economies are set to grow over the year, with the exception of Greece who will face a small decline in 2010, and the non OECD world is set to bounce back more rapidly.
Unemployment in the EU is set to hit double digit figures exceeding 10% for the next two years. Eight countries are set to stay above 10% with Spain (19.3%), Turkey (15.2%) and Ireland (14%) likely to struggle for some time yet in returning to strong expansion.
A summary of the forecasts is provided on the OECD website with detailed assessments of individual countries too.
Monday, 9 November 2009
Boston Consulting Group (BCG) Value Creators Report 2009
I have just been reading the latest BCG report published last month on the value creation of companies and industries over the year: www.bcg.com/documents/file31738.pdf
A must read for everyone in positions of responsibilty in business
The report is of real interest as it not only looks at performance over the last year and 5 years, but also at 'sustainable' value creation over the last decade. In part this is the reaction against the cries of 'short termism' against what appears to be a US influenced obsession about stock price performance. Of real note is the pervasive presence of businesses from South Korea, Japan, India and Brazil. Of the top 10 global industries over the last 5 years to 2008 these countries account for 6 of the places. And that is sustained even if we strip out the crash that had already destroyed stock values in the last year of the analysis.
US companies dominate the tables of value creators over the decade as a whole, but we have to wonder....
A must read for everyone in positions of responsibilty in business
The report is of real interest as it not only looks at performance over the last year and 5 years, but also at 'sustainable' value creation over the last decade. In part this is the reaction against the cries of 'short termism' against what appears to be a US influenced obsession about stock price performance. Of real note is the pervasive presence of businesses from South Korea, Japan, India and Brazil. Of the top 10 global industries over the last 5 years to 2008 these countries account for 6 of the places. And that is sustained even if we strip out the crash that had already destroyed stock values in the last year of the analysis.
US companies dominate the tables of value creators over the decade as a whole, but we have to wonder....
Thursday, 5 November 2009
Bank of England holds interest rate at 0.5% and continues QE at more modest level
The MPC at the Bank of England has decided to hold its interest rate at 0.5% today and to extend its use of quantitative easing by a further £25bn over the next three months on top of the £175bn already authorised by the Chancellor.
It was a finely balanced decision.
It was a finely balanced decision.
Wednesday, 4 November 2009
What next for the Bank of England?
As the MPC meets on Thursday they are faced by a dilemma: whether to believe the latest GDP data telling us the UK is still in recession or the growing amount of data that we are past the worst and at the start of a long uphill climb towards growth.
The record of success in using the early survey data to indicate the growth of the economy is pretty poor. Remember last quarter the first release data had us contracting by nearly 1% while the later figures showed a contraction of some 0.6%. At a time when the statistics are telling us one thing I think we should believe what we are seeing: that we are close to zero - if not mildly positive - growth and that the MPC should hold back from extensive injections of liquidity into the system for fear of starting a credit led bout of inflation in due course.
For sure any signs really are fragile, but they are there. Whether it is a slowdown in corporate insolvencies or growing retail numbers, we are seeing indications that the markets are starting to re-structure and turn to thoughts of growth.
The record of success in using the early survey data to indicate the growth of the economy is pretty poor. Remember last quarter the first release data had us contracting by nearly 1% while the later figures showed a contraction of some 0.6%. At a time when the statistics are telling us one thing I think we should believe what we are seeing: that we are close to zero - if not mildly positive - growth and that the MPC should hold back from extensive injections of liquidity into the system for fear of starting a credit led bout of inflation in due course.
For sure any signs really are fragile, but they are there. Whether it is a slowdown in corporate insolvencies or growing retail numbers, we are seeing indications that the markets are starting to re-structure and turn to thoughts of growth.
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