Straws of hope from GDP


Anyone who still wants to be optimistic about the UK economy after today has two important facts to cling to.

The first is that these early estimates are likely to be revised - and at least some in the city think the revision is more likely to take the number up than down. Regular readers will be thrilled that our old friend, the construction sector, is in the frame again - the sharp fall in output in this sector in December is very much an estimate, which some consider a little fishy.

The second point of potential hope is that these numbers deal with the past. They do not necessarily tell us much about the future.

Taking away the one-off boost from the Olympics, the figures suggest that the UK economy was broadly flat in the second half of the year.

There have been mixed signals from the real economy in recent weeks, but few in the City are now predicting a dramatic downward lurch. The broad sense is of an economy that is treading water - not one that is about to drown.

A second consecutive quarter of falling output is possible - the much talked about triple dip. But as the Bank of England governor has pointed out recently, that is quite likely in an economy that is broadly flat.

The IMF expects Britain's national output to be 1% larger at the end of this year than at the start, and to grow by 2% in 2014.

Even that would barely take the country back to where it was at the start of 2008. But it is faster than any major economy across the Channel - the eurozone is collectively expected to shrink in 2013, with little or no growth even in 2014.

Stephanie Flanders Article written by Stephanie Flanders Stephanie Flanders Former economics editor

So it's goodbye from me

After 11 years at the BBC, I'm leaving for a new role in the City.

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  • rate this

    Comment number 111.

    "A "full review" of the wholesale fuel market is needed as petrol prices are expected to rise sharply, according to the Petrol Retailers Association (PRA)"

    That should help the economy!
    I smell this quarters GDP excuse already. Can I claim it as my own George?

  • rate this

    Comment number 110.

    The figure is likely to be revised?

    No surprises there......every figure gets subsequently revised......

    ....and thus far under the Coalition the revised figures have spelt even more doom & gloom for our economy......

    ....time for plan B young Gideon......

  • rate this

    Comment number 109.

    'don't we just love to knock ourselves
    ftse is higher than it's been for 18 months at least a little confidence is returning'

    The ftse is merely another arm of the gambling casino. I for one have no confidence in gamblers after all, how do you think the financial sector managed to get us into this situation in the first place, betting on certainties?

  • rate this

    Comment number 108.

    107. Five Stars

    Not as delusional as you!

  • rate this

    Comment number 107.

    106.Reality Check

    Not as crazy as you.

  • rate this

    Comment number 106.

    Overdose: The Next Financial Crisis ( The UK and Europe (and not only the USA) are doing the same to this day! QE does not work! The real economy is going to get worse! It's being built on sinking sand! Any growth is phony & a facade. The data is manipulated. The real economy is going down! Bailouts and propping up debt with more debt? Crazy!

  • rate this

    Comment number 105.

    72. quietoaktree

    --Producing 90 % of oil and 70% of our own energy requirements and Sterling in the cellar.

    -- are we making more sandwiches for export ?

    "Our" own energy requirements!?
    Are "we" making more sandwiches for export!?

    Out of the closet as a self-loathing Brit expat? Or more faces than a Rubiks cube?

  • rate this

    Comment number 104.

    don't we just love to knock ourselves
    ftse is higher than it's been for 18 months at least a little confidence is returning
    suppose you lot would have nothing to moan about if it wasn't for all these
    number crunching qwangos

  • rate this

    Comment number 103.

    A final message to the banking sector that is getting away scot free in this economic slump.

    Never was so much owed by so few to so many.

    Sounds a bit like a Churchill speech I know.

  • rate this

    Comment number 102.

    So it was a slump in North Sea oil production that caused the tragic GDP figures along with a decline in manufacturing
    They have been warned about peak oil !
    What are all these newly employed people doing?
    manufacturing is down and service sector flat lining. The ONS are correct,government-supported schemes accounted for about 100,000 jobs of about 500,000 created in the previous year.

  • rate this

    Comment number 101.


    Indeed, if interest rates reach 4-5% then the disaster will be full circle. According to Shelter, the housing charity, one fifth of UK households are struggling with mortgage/rent payments already. Now, anyone want to have a stab at predicting what this would rise to if interest rates go up? How many homeless people can we accept, 20 million?

  • rate this

    Comment number 100.

    I fail to see the point of your regular 3 monthly reviews of UK performance with excuses for failure being trotted out regularly.
    ONS has a job to do, you economics commentators need to accept the estimates for what they are, simply direction indicators.
    We have had the rotten Parliament and now we have the phoney Parliament and nothing's gonna change!

  • rate this

    Comment number 99.

    "Straws of hope from GDP"
    Oh! That's okay then.

    Imagine what would happen if people were told that approx 40p of every £1 they spend & 50% of Gov. spending (their taxes) goes in interest payments (unearned earnings) to the withholders of the nations medium of exchange, money.

    Capitalism needs growth (hence the GDP obsession) to service these unearned earnings, a market economy doesn't.


  • rate this

    Comment number 98.

    I fear things have got so bad in the UK that much respected BBC economics commentators are reduced to "perking us up".

    No doubt the govt has a semi-permanent big stick raised above poor old aunty beeb. I saw Dave's look at Davos when he accidently invited a question from Stephanie. Osborne now has a sickly look in his face, like a manager of a failing football nailed to the bottom of the table.

  • rate this

    Comment number 97.

    Given that the UK population is growing by c.1% per year shouldn't we expect a 1% rise in GDP from that alone?

  • rate this

    Comment number 96.

    I see they got to you fast Stephanie. Your first article was spot on, but that has disappeared. Seems like you are being leant on. Has ids been on the phone again? Stick to your guns girl and carry on exposing this governments lies. If it's not possible at the BBC, then move to an organisation with a bit more self respect.

  • Comment number 95.

    All this user's posts have been removed.Why?

  • rate this

    Comment number 94.

    Why is Stephanie defending Osborne?

    And why has she failed to mention his name in the above 'Straws of hope from GDP' column?

    Treading water on the brink of a third recession isn't good enough - especially when the vulnerable pay the price of Tory economic delinquency. Yes, incompetence is bad enough, but ideology-driven incompetence equals delinquency.

    Unforgivable behaviour…

  • rate this

    Comment number 93.

    From where I am looking I can see no green shoots.

    Not even any Snow Drops.

    Just months and months of cold porridge. Courtesy of the Posh Boys.

    Why do they do it?
    To mess us about obviously.

    Remember well.

  • Comment number 92.

    All this user's posts have been removed.Why?


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