The Olympics and Paralympics have been a superb spectacle this summer, but will they help the economy? No one in the Treasury thinks so – if anything, they fear the games will hurt the figures and pretty soon we’ll be hearing about the ‘Olympic Effect’ damaging Q3 growth figures. George Osborne is already being mocked for his habit of blaming downturns on snow, holidays etc so I suspect the Chancellor will not mention it. But when first class returns from London to New York were half the price they normally are, you have the feeling not much business is being done.
Today, the first economic indicator has come suggesting an Olympic effect. Each month, the European Commission takes an Economic Sentiment Index. Today’s reading has dropped markedly in at the lowest since May, suggesting zero growth in Q3 to follow on from the zero growth in Q2.
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