Image may be NSFW.
Clik here to view.
On Tuesday I wrote UK moves to growth. Yesterday, we had a raft of further news which rather supported the argument.
Firstly, the outgoing Governor of the Bank of England gave his last Quarterly Economic Forecast. He stressed that ‘recovery was in sight’ as he raised UK GDP growth forecasts from 1% to 1.2% for 2013. He was also able to point to slightly lower inflation.
Conversely the Eurozone put out a bleak report showing a 0.2% decline in Q1 with France in recession and the outlook for Germany markedly lower.
Also the news from the US – which is turning back to its old role of being the powerhouse of the world economy – had wall-to-wall good news on jobs, deficit etc. Even Japan reported some pretty exceptional growth – for them anyway.
Now, I know there are sceptics out there and, let’s face it, a 1.2% growth for 2013 is pretty minor in any historic context. But this is about the first time in the last 5+ years that the revisions are upwards. It is even more exceptional given the Eurozone problems and downturn. Afterall we do more than 50% of our trade with Europe (not just the Eurozone) So this recovery in the UK is being fuelled by an uplift in domestic demand (the lion’s share) and our trade with the US, BRICs and elsewhere outside of Europe.
We are far from being out of the woods yet and there are still ‘events’ that could knock this fragile recovery off its tracks. But at least there was some good news to report for once on a long, long time.
