Take GDP figures with pinch of salt: We’re still spending
REVISION, revision, revision. Now the exam season is over it’s time for economists to take over the reins from students.
Today’s GDP figures, up 0.6% in the quarter to June and rising 2.2% on an annual basis, could be the great last huzzah before the effects of Brexit take a firm hold.
They could equally be a signal that British business was determined to go into the vote and to come out the other side firing on all cylinders.
Certainly today’s £275 million commitment by GSK to expand three manufacturing sites in the UK is hardly the move of a frightened multinational looking to exit our shores.
Notably the ONS’s chief economist Joe Grice commented: “Very few respondents to ONS surveys cited such uncertainties as negatively impacting their businesses.” That could change. But so too could the ONS’s figures.
Over the past two decades revisions to annualised GDP readings have been revised (sometimes years later) by an average 0.5% upwards. That’s upwards. So today’s reading of 2.2% could actually turn out to be 2.7%, which would put us easily at the top of growth in Europe and ahead of the US.
Anecdotal evidence, from the likes of Barclaycard and Virgin Money, is that consumers have not stopped spending since they voted to leave Europe.
That alone is not enough to make Mark Carney & Co defer an interest rate cut and perhaps other stimuli to the economy next week. But it could mean they don’t have cut as low and for so long as some fear.
Rodents in the net
IF, like me, your mind already boggles at Amazon delivering hundreds of small packages to your back garden by drone, try and get your head round digital rat-catching.
But that’s exactly what Rentokil, teamed with Google and PA Consulting, announced today. Apparently, it has already tested the technology allowing it to alert a large Dutch supermarket chain of an emerging mouse problem at one of its stores and got in there fast to eradicate the vermin.
Pest control is all about dealing with problems before they become overwhelming. If GPS, central command centres and intelligent traps mean Rentokil can pinpoint where those problems are about to occur that is revolutionary.
Not so much the royal rat-catcher as the digital destroyer.
French farce
NICOLAS Sarkozy once described Michel Barnier’s appointment as European Commissioner as “a French victory and a defeat for Anglo-Saxon capitalism”. Now Barnier is to lead negotiations with Britain over Brexit. Zut alors!