Britain emerged from recession at a faster pace than previously estimated in the fourth quarter, providing a boost for Prime Minister Gordon Brown as he prepares for a general election within weeks.
Gross domestic product rose 0.3 percent from the third quarter, compared with a previous calculation of 0.1 percent growth, the Office for National Statistics said today in London. The median forecast in a Bloomberg News survey of 27 economists was for a 0.2 percent increase.
Bloomberg
The employment outlook in Switzerland is improving, data showed on Thursday, after the number of jobs dipped only minimally at the end of 2009, showing that the economic recovery may reach the labour market soon.
Non-farm payrolls fell by 0.1 percent year-on-year in the last three months of 2009 to 3.96 million, the Federal Statistics Office said.
However, payrolls were 0.1 percent higher compared with the third quarter when also adjusted for seasonal factors, and the statistics office’s index for the employment outlook rose by 0.4 percent.
“The indicators point to a rise in employment in the first quarter,” the office said. The seasonally adjusted index for vacancies pointed to a positive development in the industrial sector as well as in the service sector.
Reuters
Economic Indicators
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Inflation in Switzerland accelerated in January by more than analysts had expected, indicating that the threat of deflation is fading quickly.
The consumer price index in January rose 1.0 percent from a year ago, though it was 0.1 percent lower compared with the previous month, the Federal Statistics Office said on Thursday.
“The influence of (winter) sales was weakened by rising crude oil prices,” the statistics office said.
Core inflation, which strips out volatile price elements such as tobacco and fuel, ticked up to 0.6 percent. Economists polled by Reuters had expected a yearly headline inflation rate of 0.6 percent.
Switzerland emerged from recession in the third quarter of 2009, and recent indicators have pointed towards further recovery. Last year, consumer prices posted their first full-year decline since 1959.
Reuters
The Office for National Statistics (ONS) announced to day that manufacturing output in the UK increased by 0.5 percent in the final quarter of 2009. This helped the overall economy grow by 0.1 percent during the last three months of the year.
According to the British Chambers of Commerce, the result was “stronger than expected and reinforce hopes that 2009’s fourth quarter GDP growth will be revised upwards – possibly by even more than the ONS has indicated.”
Despite the positive result, the BCC warned that the improvement “does not mean there is any room for complacency. Manufacturing declined sharply last year and annual growth is still in negative territory”.
Source: BBC News
Britain borrowed £15.7bn to balance the books last month, the highest December figure on record, as two-and-a-half years of financial crisis and recession took a toll of the public finances.
Despite some signs that the pace of decline may be easing, the government’s net borrowing stood at £120bn in the first nine months of the financial year, almost double the total for the same period in 2008-09.
The Office for National Statistics said the gap between government spending and tax receipts received by HM Revenue and Customs was the highest since recent records began in 1993.
source: Guardian
According to the Office for National Statistics (ONS), the UK lost 21,000 jobs between August and October, bringing the total number of officially unemployed to 2.49 million. The good news however, is that this was the lowest three-month total since the second quarter of 2009.
“It is still tough for a lot of people and we still expect unemployment to increase again in the New Year. So we are determined to do more, supporting a total of 400,000 extra youth opportunities over the next 18 months,” said Yvette Cooper, Secretary of State for Work and Pensions.
BBC News
A weaker US dollar helped boost exports to $136.8 billion for the month of October – a 2.6 percent increase over September. The overall trade deficit fell to $32.9bn compared to September’s downwardly revised $35.7bn figure.
BBC News
The British pound got off to a rocky start today after the Office for National Statistics (ONS) announced that the economy contracted another 0.4 percent between July and September. This marks the sixth straight quarter that the economy has failed to record positive growth, and confirms that England remains mired in recession a full six months after France and Germany both returned to positive growth.
Since the beginning of the recession, the UK’s Gross Domestic Product has declined 6 percent and there is little on the horizon to suggest that the nation’s economic troubles will soon improve. For the quarter ending in August, unemployment rose another 0.7 percent to 7.9 percent – an increase of 2.3 percent over the same time last year, boosting the number of unemployed people to 28.8 million.
The question now is, how will the Bank of England respond?
Like most other central banks, the Bank of England slashed lending rates to record lows early into the recession, so there is little more than can be done in this area. The Bank also entered into a program of quantitative easing to inject cash directly into the financial system, committing £175 billion (USD$290.3 billion) to the spending plan.
Unfortunately, most of the funds have already been allocated, yet the economy continues to shrink. For this reason, many observers feel that the government will be forced to borrow more money to continue the spending program, and while this may help slow sterling’s descent in the short term, it seems that the pound will continue to under-perform most of the major currencies until the economy finally breaks out of its prolonged recession.
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