Thursday, February 03, 2011

Obscurantism over Osborne's orthopraxy...

Under-reporting the good bits! Last week Angel Gurria, secretary general of the Organisation for Economic Cooperation and Development (OECD) said the "UK must stay the course" [listen]. He states that the UK is being courageous putting everything that was needed on the table; he reiterated where we are now is a result of what happened before and that underlying inflation is under control. This was in response to massive media coverage of the unexpected drop in growth; since then there have been a series of good figures: "This week the economic news has been so much better." writes Tim Montgomerie. UK manufacturing growth at fastest since records began [BBC] and the Construction industry returning to growth [ Markit/CIPS PDF], despite being reported, don't seem to get the same "gory" headline coverage as the GDP drop. One response now will surely be those joining the 'Andrew Sentance camp' in calling for an interest rate rise, that will get the Press attention.

Bookmark and Share


Paul said...

An interest rate rise at a time when inflation is higher than forecast and commodity prices are rising doesn't make sense to me to be honest.

Interpretation of reporting manufacturing growth depends on where you sit regarding jobs or GDP. In the short term GDP is the real goal so it's looking good, in the long term though jobs are still scarce and us along with the U.S.A continue to import far more than we export, plus the fact that some service industries have been re-categorised as manufacturing since 1992 to lessen the real pain.

All that said I've just seen the latest figures for my biggest engineering client and they are so good I burst out laughing (I know we are a sad profession!)

Span Ows said...

Hi Paul, we know your profession are real people so laughing and smiling now and again isn't too odd ;-)

Your phrase "depends on where you sit regarding jobs or GDP" is certainly spot-on. Re the export thing they will rise but I doubt these days we will EVER get the balance of trade down where "it should be" again.