UK contraction worse than thought

RenovationMan

"The UK economy shrank by more than previously thought during the last three months of 2010, revised figures suggest.

Gross domestic product (GDP) slipped by 0.6% in the period, according to fresh data from the Office for National Statistics.

Its initial estimate had suggested the economy had contracted by 0.5% - with heavy snow blamed for the slump.

The data may mean a rise in interest rates will not come as soon as thought."


http://www.bbc.co.uk/news/business-12577154

Graham_Devon

Don't think this slight change will make much difference to interest rate considerations.

Mr._H_2

Graham_Devon wrote: »

Don't think this slight change will make much difference to interest rate considerations.

Agreed.

Really surprised by this new data though. I really was expecting the figure to improve upon revision.

Wookster

Not the best news for sure but it does seem somewhat out of step with what actually happened in Q4.

As to interest rate rises, oil prices must be a huge factor in that decision now.

Mallotum_X

Mr._H wrote: »

Agreed.

Really surprised by this new data though. I really was expecting the figure to improve upon revision.

Personally I would expect what we had, quite often these figures are marked down, quite a few other 'confidence' type figures get revised down when you follow them though.

House price figures being a prime example, prior months are frequently revised down recently, so current monthly changes seem better, all part of feeding the data out carefully.

Rochdale_Pioneers

Bravo boys. So where are the economic improvements in Q1 coming from? High inflation (albeit cost push inflation from abroad), sky high oil prices, the VAT increase, mass redundancies announced, millions ore in fear of their jobs, the private sector now bluntly saying they aren't creating new jobs.

I desperately hope the optimists are right, because the last thing we need is a recession here whilst our competitors continue to grow their recoveries. But I can't see how we're going to turn things around. Even if the snow drag was 0.5% - and given its non-appearence in all the other countries buried under the snow at the same time it sounds like cobblers - the other drag factors listed above surely make it very hard for such a swing back upwards.

Will the government's remedy will be yet more cuts?

Generali

Rochdale_Pioneers wrote: »

Bravo boys. So where are the economic improvements in Q1 coming from? High inflation (albeit cost push inflation from abroad), sky high oil prices, the VAT increase, mass redundancies announced, millions ore in fear of their jobs, the private sector now bluntly saying they aren't creating new jobs.

I desperately hope the optimists are right, because the last thing we need is a recession here whilst our competitors continue to grow their recoveries. But I can't see how we're going to turn things around. Even if the snow drag was 0.5% - and given its non-appearence in all the other countries buried under the snow at the same time it sounds like cobblers - the other drag factors listed above surely make it very hard for such a swing back upwards.

Will the government's remedy will be yet more cuts?

What is Labour's policy for dealing with this?

RenovationMan

Generali wrote: »

What is Labour's policy for dealing with this?

Spend money and pass the problem onto the next generation. It's the Socialist way.

worldtraveller

ONS

Mr._H_2

Rochdale_Pioneers wrote: »

Will the government's remedy will be yet more cuts?

What do you propose? Spend more money that we don't have?

abaxas

Mr._H wrote: »

What do you propose? Spend more money that we don't have?

Slavery is the only plan he has.

Forcing those in the future to pay for things he wants to enjoy now.