August 12, 2022
UK: Holidays Reduce Output in Jun-22
- UK GDP contracted by 0.6% m-o-m in June after a downwardly revised 0.4% growth in May, which appears to confirm the distortions from the Diamond Jubilee holidays.
- Some positive payback should occur in July as the output level normalises with the number of working days. However, GDP looks to be trending barely better than flat.
- Aggressively increased interest rates will compound inflation’s squeeze on the cycle, raising the risk of a needless recession when pressures are burning out anyway.
By Philip Rush
July 22, 2022
UK: Sales Down, Down, Deeper and Down
- The British consumer continued suffering from painfully high inflation in June, with no significant real growth since Oct-21 creating an annual decline near 6%.
- Food sales were relatively high in June but should probably be read relative to the deep drop in May amid bank holiday changes. April’s similar rise was revised away.
- Non-retail consumption is also being squeezed. New car sales are trending down at near a 20% annual pace. Consumers are being forced to drop discretionary purchases.
By Philip Rush
July 22, 2022
Surveys Screeching Toward Recession
- Global manufacturing is trending towards contractions, with the Euro area now leading the way for the worse. At least price pressures are easing in the process.
- Services are also being increasingly smashed, proportional to accelerated policy tightening, with the US indicated as contracting, and the EA on the cusp of joining it.
- Survey-based measures of activity don’t always move with the hard data. However, broad trend shifts tend to be shared signals rather than noise, so they need respect.
By Philip Rush
