Money

Did GDP fall in July because of the wet weather? That’s the argument being made this morning, as the Office for National Statistics reveals that the economy contracted by 0.5 per cent in July, after having grown 0.5 per cent in (warm and sunny) June. Services output, production output and construction sectors all fell, by 0.5 per cent, 0.7 per cent and 0.5 per cent respectively, as the bad weather took its toll. It stands to reason that weather did play a factor. Monthly GDP figures are sensitive to these kinds of effects, which also include disruptions like bank holidays or strikes. The impact of frequent industrial action this year has repeatedly

The Trades Union Congress (TUC) has vowed to report the government to the UN workers’ rights watchdog over its controversial strikes bill, but how seriously can we take this threat? The TUC’s leader, Paul Nowak, certainly sounds like a man on a mission: earlier this year, Nowak claimed the legislation was ‘almost certainly illegal’, a curious assertion given it was going through parliament at the time. Now that the bill has received royal assent, it appears the TUC is doubling down on its war on the strikes bill. Yet it’s hard not to see the TUC’s complaint as anything other than a stunt designed to further denigrate the Tories who, to the

Last week’s anniversary of Liz Truss entering Downing Street could have passed by quietly. But the Trussites had other ideas. Her supporters used the moment to make the case for Trussonomics once again: to say that Truss diagnosed the country’s problems correctly and that she was on track to find solutions – until her many conspirators took her down. As it turned out, the cheerleading was a warm-up to the big event: yesterday Truss announced the details of her upcoming book – Ten Years to Save the West – which will be published next spring. Speaking to the Mail on Sunday, the former prime minister promised a detailed account of her time in Downing Street,

Is the UK set for its 15th consecutive interest rate hike later this month? Markets expect that rates will peak closer to 6 per cent – up from 5.25 per cent now – but this might not happen immediately – or at all. Speaking at today’s Treasury Select Committee, the Bank’s governor Andrew Bailey suggested rate hikes were no longer a matter of certainty, as the headline rate of inflation is now back on track with the Bank’s projections for a significant fall by the end of the year. Speaking to MPs this afternoon, Bailey said that the UK had moved on ‘from a period … where it was clear rates needed

Over mighty trade unions. Short-termist management that prioritises profits over investment. And an education system that doesn’t produce enough scientists or engineers. There have been many different versions of the ‘British disease’ over the years to explain the consistent under-performance of our economy compared to some of our main rivals. But right now there is a new one: the British don’t want to go back to the office – and that is hitting output hard.  According to a survey by the consultancy AWA published this week, the British are more reluctant to go back to the office than workers in almost any other major developed country. Even as bosses plead

So the economy has defied the predictions of doom once more. The latest figures released by the Office for National Statistics (ONS) this morning show that the economy grew by 0.5 per cent in June, more than countering a 0.1 per cent fall in May, widely attributed to the extra bank holiday for the coronation. Over the three months to June the economy grew by 0.2 per cent, following a 0.1 per cent expansion in the first quarter. One of the most promising aspects of today’s figures is that all sectors of the economy grew in June, with production (1.8 per cent) and construction (1.6 per cent) outpacing services (0.2

It will be harder to pick up a last-minute light bulb. You might have to rely on Amazon Prime for a quick delivery of new tea towels. And your local shopping centre will look even more dismally empty than it already does.  There will, in fairness, be some disadvantages to the hardware chain Wilko disappearing. And yet there is no point in pretending that it is any great loss. In reality, it was one of many ‘zombie’ companies, kept alive by artificially low interest rates. Now that capital costs money again, many more will go bust.  Wilko announced today that it was going into administration, and that its 400 stores

First the good news – the fall in living standards may be coming to an end, with wages starting to run ahead of inflation. Now the bad news: it is as much because wages are rising than inflation is falling – which suggests that high inflation is beginning to become embedded in workers’ expectations. Capital Economics is forecasting that next week’s inflation figures will show the Consumer Prices Index (CPI) at 6.8 per cent, down from 7.9 per cent last month. Average earnings figures, it predicts, will simultaneously rise to 7 per cent – up from 6.9 per cent last month and up from 6.1 per cent a year earlier.

The Bank of England has raised the base rate yet again, this time to 5.25 per cent, a high not seen since April 2008. Like a child trapped in the back seat of a sweltering car, the response of many people will be: ‘Are we nearly there?’      Many people seem to think so – that perhaps there will be one or two rises to come before rates peak and perhaps even start to fall modestly next year. Markets seem to think that 5.75 per cent will most likely be the summit.   I wouldn’t be so sure. What stands out most from the Monetary Policy Report that accompanied the interest rate

It is quite right that the Prime Minister has chosen to approve new licences for oil and gas extraction in the North Sea, in spite of the bitter reaction from climate activists, the Labour party – and some of his own MPs. Chris Skidmore, who just recently completed a review of net zero policies on behalf of the government, said this week that the decision to award new licences ‘is on the wrong side of the future economy that will be founded on renewable and clean industries and not fossil fuels’. Yet the Prime Minister is not retrenching on investment in renewable energy; he is hedging the government’s bets. While

The current government will do almost anything to avoid reforming welfare or the NHS. Last month, we were informed school leavers might be allowed to train as doctors without a traditional medical degree in an ill-conceived cosplay scheme. And it was reported yesterday that GPs may be encouraged to refer patients to life coaches, rather than issue sick notes, to help people get back into work. Between the starts of 2019 and 2023, the number of economically inactive working adults with depression or anxiety jumped by 40 per cent to hit 1.35 million. There are 400,000 more people on long-term sickness than before the pandemic. Yet rather than hiring more