Some valid concerns raised on where this GDP growth is coming from. Government spending (G) and the public sector component of investment (I) up more than 20% in real terms since Q4 2019. The private sector counterparts up just over 3%. This is one of the reasons why this feels very different depending on which part of the UK economy you are exposed to.View quoted post on X
The Globalist: As Paraguay’s recently impeached president, Santiago Peña, awaits trial, we ask: how did a digital bank upend the country? Then: in an era of hybrid warfare, are military bases an asset or a liability? Plus: @soniapurnell on the honeypot buff.ly/8cNg8r0View quoted post on X
"GDP data day" inevitably gets seized upon to draw some political conclusions. I have no dog in the fight but if you take a basket of economic indicators and compare the 14 years of Conservative-led governments, with the last 2.5 years you get a nuanced picture.
The clear top level ambitions for Labour to have decent GDP per capita, RHDI, and investment growth have seen (modest) upticks on 2010-2024. The major (negative) outlier is on workforce jobs that have stagnated (albeit LFS, WFJ, RTI all showing different trends).
My main takeaway would be most of the big economic metrics do not suggest to a step change with the change of government - as you might expect given the deeply-entrenched supply rationing that caps UK growth. But that policy incentives - positively on investment; negatively on job creation - have had an impact.View quoted post on X
Both Fed (Waller) and BoE (Lombardelli) central bankers talking today about the lack of dynamism in the labour market - specifically low levels of churn.
As AI is almost certainly changing the pattern of demand the flexibility for labour to move to where the new demand emerges (high churn rate) is a really important part of the forward productivity story/ avoiding structural unemployment.
It does suggest that this is not a great time to be increasing the on-costs of creating new employment (Employer NICs, Employee Rights Act, raising NLW far faster than productivity). And yet that has been precisely what has happened in the UK.
This chart from Clare is stark....View quoted post on X
The subtext to the whole MPR is “the UK can’t grow particularly fast without generating inflation”. That is why the MPC felt they had to act to a supply side shock.View quoted post on X
