adplus-dvertising
Connect with us

Economy

UK economy saw no growth at the end of 2019

Published

 on

The UK economy saw no growth in the final three months of 2019, as manufacturing contracted for the third quarter in a row and the service sector slowed around the time of the election.

The Office for National Statistics (ONS) said the car industry had seen a particularly weak quarter.

The ONS figures also showed the economy grew by 1.4% in 2019, marginally higher than the 1.3% rate in 2018.

Recent surveys have suggested that the economy has picked up in the new year.

300x250x1

Ruth Gregory, senior UK economist at Capital Economics, suggested that the flat growth seen at the end of the year would “prove to be a low point”.

She added: “The pick-up in the surveys of activity and sentiment suggest the first quarter will be much better.

“The GDP figures were not quite as bad as we had feared in quarter four. The stagnation in GDP beat our forecast of a 0.1% quarter-on-quarter fall.”

In December alone the economy grew by 0.3%, the ONS said, reversing the decline seen previously in November.

“It’s likely that political uncertainty and unwinding stockpiles caused the economy to flag at the end of last year,” said Tej Parikh, chief economist at the Institute of Directors.

“However, firms entered 2020 with more of a spring in their step. Confidence has shot up, while hiring plans and investment intentions have also risen a notch, but the post-election bounce may tail off.

Rob Kent-Smith, the ONS’s head of GDP, said: “There was no growth in the last quarter of 2019 as increases in the services and construction sectors were offset by another poor showing from manufacturing, particularly the motor industry.”

The services sector – which accounts for more than three-quarter of the UK economy – grew by just 0.1% in the final quarter of 2019, while the construction sector grew by 0.5%.

However, the manufacturing sector saw output fall by 1.1%. That came after some car factories paused work in November in case Britain left the European Union without a deal on 31 October.

The ONS revised up the growth figure for the third quarter of 2019 to 0.5% from its previous estimate of 0.4%.

The last three months of 2019 also saw the trade deficit in goods and services widen to £6.5bn from the £4bn deficit seen between July and September.

A deficit occurs when the value of a country’s imports in goods and services exceeds what it exports.

The deficit widened largely because of a shrinking of the surplus in UK trade in services.

By contrast, the goods trade deficit shrank in the last three months of 2019. That was mostly accounted for by a £2.2bn decrease in machinery and transport equipment imports, which could suggest that orders might have been brought forward to avoid the (postponed) October Brexit deadline.

For 2019 as a whole, the trade deficit for goods and services narrowed slightly by £0.5bn to £29.3bn.

Source link

Continue Reading

Economy

China Wants Everyone to Trade In Their Old Cars, Fridges to Help Save Its Economy

Published

 on

China’s world-beating electric vehicle industry, at the heart of growing trade tensions with the US and Europe, is set to receive a big boost from the government’s latest effort to accelerate growth.

That’s one takeaway from what Beijing has revealed about its plan for incentives that will encourage Chinese businesses and households to adopt cleaner technologies. It’s widely expected to be one of this year’s main stimulus programs, though question-marks remain — including how much the government will spend.

Adblock test (Why?)

728x90x4

Source link

300x250x1
Continue Reading

Economy

German Business Outlook Hits One-Year High as Economy Heals

Published

 on

German business sentiment improved to its highest level in a year — reinforcing recent signs that Europe’s largest economy is exiting two years of struggles.

An expectations gauge by the Ifo institute rose to 89.9. in April from a revised 87.7 the previous month. That exceeds the 88.9 median forecast in a Bloomberg survey. A measure of current conditions also advanced.

“Sentiment has improved at companies in Germany,” Ifo President Clemens Fuest said. “Companies were more satisfied with their current business. Their expectations also brightened. The economy is stabilizing, especially thanks to service providers.”

A stronger global economy and the prospect of looser monetary policy in the euro zone are helping drag Germany out of the malaise that set in following Russia’s attack on Ukraine. European Central Bank President Christine Lagarde said last week that the country may have “turned the corner,” while Chancellor Olaf Scholz has also expressed optimism, citing record employment and retreating inflation.

300x250x1

There’s been a particular shift in the data in recent weeks, with the Bundesbank now estimating that output rose in the first quarter, having only a month ago foreseen a contraction that would have ushered in a first recession since the pandemic.

Even so, the start of the year “didn’t go great,” according to Fuest.

“What we’re seeing at the moment confirms the forecasts, which are saying that growth will be weak in Germany, but at least it won’t be negative,” he told Bloomberg Television. “So this is the stabilization we expected. It’s not a complete recovery. But at least it’s a start.”

Monthly purchasing managers’ surveys for April brought more cheer this week as Germany returned to expansion for the first time since June 2023. Weak spots remain, however — notably in industry, which is still mired in a slump that’s being offset by a surge in services activity.

“We see an improving worldwide economy,” Fuest said. “But this doesn’t seem to reach German manufacturing, which is puzzling in a way.”

Germany, which was the only Group of Seven economy to shrink last year and has been weighing on the wider region, helped private-sector output in the 20-nation euro area strengthen this month, S&P Global said.

–With assistance from Joel Rinneby, Kristian Siedenburg and Francine Lacqua.

(Updates with more comments from Fuest starting in sixth paragraph.)

Adblock test (Why?)

728x90x4

Source link

Continue Reading

Economy

Parallel economy: How Russia is defying the West’s boycott

Published

 on

When Moscow resident Zoya, 62, was planning a trip to Italy to visit her daughter last August, she saw the perfect opportunity to buy the Apple Watch she had long dreamed of owning.

Officially, Apple does not sell its products in Russia.

The California-based tech giant was one of the first companies to announce it would exit the country in response to Russian President Vladimir Putin’s full-scale invasion of Ukraine on February 24, 2022.

But the week before her trip, Zoya made a surprise discovery while browsing Yandex.Market, one of several Russian answers to Amazon, where she regularly shops.

300x250x1

Not only was the Apple Watch available for sale on the website, it was cheaper than in Italy.

Zoya bought the watch without a moment’s delay.

The serial code on the watch that was delivered to her home confirmed that it was manufactured by Apple in 2022 and intended for sale in the United States.

“In the store, they explained to me that these are genuine Apple products entering Russia through parallel imports,” Zoya, who asked to be only referred to by her first name, told Al Jazeera.

“I thought it was much easier to buy online than searching for a store in an unfamiliar country.”

Nearly 1,400 companies, including many of the most internationally recognisable brands, have since February 2022 announced that they would cease or dial back their operations in Russia in protest of Moscow’s military aggression against Ukraine.

But two years after the invasion, many of these companies’ products are still widely sold in Russia, in many cases in violation of Western-led sanctions, a months-long investigation by Al Jazeera has found.

Aided by the Russian government’s legalisation of parallel imports, Russian businesses have established a network of alternative supply chains to import restricted goods through third countries.

The companies that make the products have been either unwilling or unable to clamp down on these unofficial distribution networks.

 

728x90x4

Source link

Continue Reading

Trending