UK Q4 business investment falls at record annual rate

stueyhants

http://www.iii.co.uk/news/?type=afxnews&articleid=7764594&subject=economic&action=article

LONDON, Feb 25 (Reuters) - Business investment in Britain fell 5.8 percent between October and December 2009 compared with the previous three months, giving a record 24.1 percent annual drop, preliminary official data showed on Thursday.

The Office for National Statistics said that was the steepest annual fall since records began in 1967 and left investment at 27.121 billion pounds.
The figures were much lower than analysts had forecast and are likely to dampen hopes for an upward revision to total Q4 GDP on Friday.

So much for the private sector leading the country to growth. With public sector expecting a decrease or at the very best no change, where is the growth coming from to half the deficit???

Really2

Looks like the Good ship QE will be docking again soon.
Can't see rates going up either with figures like this around.

stueyhants

Really2 wrote: »

Looks like the Good ship QE will be docking again soon.
Can't see rates going up either with figures like this around.

Could also mean 4th Qtr GDP could actually be revised back in to reccession tomorrow. Possible but not sure how likely.

Graham_Devon

If GDP gets revised down, can you imagine the fireworks on here?!

Generali

As Economists like to say in these circs: "F ck i ng he ll that's just horri8ble.

The Keynsian idea is that the Government can prop things up for a short while until the private sector can do its thing. The monetarist/Austrian view is that nobody can afford to borrow because the Government is sucking up what little cash is available.

All the stuff that I've being saying and hoping I'm wrong looks like I may be right.

Och Arsenal.

chucky

Graham_Devon wrote: »

If GDP gets revised down, can you imagine the fireworks on here?!

if it gets revised down to -0.1% or -0.2% it doesn't matter - it makes good headlines for people to froth about.

we had growth at 5%-6%, small movements in the revision of growth like that are irrelevant

vivatifosi

Business investment down. Aarrrrgggghhh.... That means that half of my business isn't going to pick up any time soon (hence my working in the library).

I have watched business investment for a number of years and while there are a number of different reasons it goes up and down, a drop like this will send really bad signals to all those industries that deal in business to business capital goods: specialist manufacturing machinery, IT systems, office furniture, the list goes on.... Drat and double drat.

Really2

stueyhants wrote: »

Could also mean 4th Qtr GDP could actually be revised back in to reccession tomorrow. Possible but not sure how likely.

Current forecast is up .1% (to 0.2%), could be interesting though.

This first 1/4 is going to be poor though I think (guess)

stueyhants

chucky wrote: »

if it gets revised down to -0.1% or -0.2% it doesn't matter - it makes good headlines for people to froth about.

we had growth at 5%-6%, small movements in the revision of growth like that are irrelevant

It would be a small movement but the physiological impact will be quite high.

At least a revision will prevent the double dip so feared …. it will still be the first dip.

Graham_Devon

chucky wrote: »

if it gets revised down to -0.1% or -0.2% it doesn't matter - it makes good headlines for people to froth about.

we had growth at 5%-6%, small movements in the revision of growth like that are irrelevant

I dunno.

Personally I think just the words "we are still in recession" would do a lot of damage to sentiment.

Really2

Graham_Devon wrote: »

I dunno.

Personally I think just the words "we are still in recession" would do a lot of damage to sentiment.

So does that mean out of recession could/did do a lot to improve sentiment?;)