Q3 gdp +0.8%

wotsthat

Carl31 wrote: »

I think i will wait for the inevitable downgrade in a few weeks before i get excited, like usual

It's inevitable that the figure will be revised but which direction is anyone's guess. Some people were waiting for a 'tripple' dip but their hopes were dashed when GDP revisions meant that there hadn't even been a double dip.

Can't see what difference +/- 0.1% makes other than if that's the difference between positive and negative growth. Even then it's only relevant to headline writers and people who like arguing on the internet.

michaels

I kinda think QE serves a secondary purpose of indirectly funding the deficit. Cyclical recovery should quickly start to reduce the non-structural part of the deficit and although markets are rational yadda yadda yadda I bet it is easier to fund a 40bn deficit than a 120bn one but trying to also repay 375 bn of QE at the same time might be a bridge to far.

Interest rates are more interesting, there are obviosuly strogn political reasons for not moving although a token rise before the election might play well as a signal that the economy is now recovering and no longer needing emergency measures. Of course on the consumer side there is a strong disconnect between the base rate and both saving and borrowing rates - anyone have any guess what will happen to consumer rates as the base rate moves?!

Generali

michaels wrote: »

I kinda think QE serves a secondary purpose of indirectly funding the deficit. Cyclical recovery should quickly start to reduce the non-structural part of the deficit and although markets are rational yadda yadda yadda I bet it is easier to fund a 40bn deficit than a 120bn one but trying to also repay 375 bn of QE at the same time might be a bridge to far.

Interest rates are more interesting, there are obviosuly strogn political reasons for not moving although a token rise before the election might play well as a signal that the economy is now recovering and no longer needing emergency measures. Of course on the consumer side there is a strong disconnect between the base rate and both saving and borrowing rates - anyone have any guess what will happen to consumer rates as the base rate moves?!

Presumably, as lending markets improve and more lenders chase business spreads between base rates and lending rates will narrow. Measured by spread, lending rates are probably as high as they've been since the early C19th and possibly ever.

That narrowing will mean increases in the base rate can still mean lower market interest rates. Managing the recovery is going to be a challenge.

michaels

How much of the extra spread is down to new (Basel) rules imposing a wedge between market fundng costs and the ratre at which banks can lend money out?

On the relationship between base rates and consumer borrowing rates, McHamish and I had a disagreement, he was arguing both that sensitivity to rates would make any increases small and slow and also that as rates increased margins would fall. I suggest that one or other of these can be true but not both smultaneously - if falling margins result in changes in base rates fail to take spending power out of the economy then base rates will rise more.

Savings rates - no idea, will Basel rules and a row back of funding for lending and the EU equivalent mean these will increase with the base rate or are banks so flush with capital from other sources that they will stay stuck at little or nothing long term?!

Carl31

mayonnaise wrote: »

Does a 0.1% up- or downgrade really matter that much?

Its not so much the amount, its just when its always revised, it just looks a bit incompetant and makes you wonder how true these figures are

If i reported figures at work, which then turned out to be wrong, id get my !!!! kicked, or if one of my team did, id question whether what they were providing me was right

danothy

Carl31 wrote: »

Its not so much the amount, its just when its always revised, it just looks a bit incompetant and makes you wonder how true these figures are

If i reported figures at work, which then turned out to be wrong, id get my !!!! kicked, or if one of my team did, id question whether what they were providing me was right

So you'd never accept a preliminary estimate that is subject to revision as a deliverable even if that meant you had to wait a significantly longer time for it?

wotsthat

Carl31 wrote: »

Its not so much the amount, its just when its always revised, it just looks a bit incompetant and makes you wonder how true these figures are

If i reported figures at work, which then turned out to be wrong, id get my !!!! kicked, or if one of my team did, id question whether what they were providing me was right

The figures are rarely wrong but just subject to revision for years to come as more/ better data is collected. Given the extent of the data it's more surprising that the revisions are so small.

mayonnaise

Carl31 wrote: »

Its not so much the amount, its just when its always revised, it just looks a bit incompetant and makes you wonder how true these figures are

If i reported figures at work, which then turned out to be wrong, id get my !!!! kicked, or if one of my team did, id question whether what they were providing me was right

This is the first estimate.
Estimates are likely to be revised. The clue is in the name, estimate.

Loughton_Monkey

Carl31 wrote: »

Its not so much the amount, its just when its always revised, it just looks a bit incompetant and makes you wonder how true these figures are

If i reported figures at work, which then turned out to be wrong, id get my !!!! kicked, or if one of my team did, id question whether what they were providing me was right

Then you probably work for a dinasaur of a company.

Every modern company I know has "flash accounts" on the last day of the month (or even more frequently). They are known to be simple estimates but show the general trend or flavour. Sometimes extra time is required for full 'accurate' results but they can usually wait.

Generali

wotsthat wrote: »

The figures are rarely wrong but just subject to revision for years to come as more/ better data is collected. Given the extent of the data it's more surprising that the revisions are so small.

I think it shows how good the ONS are at what they do.