{"id":1141,"date":"2021-06-23T12:04:15","date_gmt":"2021-06-23T11:04:15","guid":{"rendered":"https:\/\/new.contentdeployment.co.uk\/tomd\/?p=1141"},"modified":"2022-07-05T14:11:07","modified_gmt":"2022-07-05T13:11:07","slug":"news-in-review-6","status":"publish","type":"post","link":"https:\/\/new.contentdeployment.co.uk\/tomd\/2021\/06\/23\/news-in-review-6\/","title":{"rendered":"News in Review"},"content":{"rendered":"
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\u201cThere is pent-up demand and\nambition across many sectors\u201d<\/em><\/strong><\/em><\/strong><\/p>\n<\/div>\n\n

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Last Friday, the\nConfederation of British Industry (CBI) published its latest economic forecast,\nwhich predicts UK GDP growth is set to bounce back to pre-COVID levels by the\nend of the year, despite the four-week delay in lifting all lockdown\nrestrictions. The industry body said the economy looks \u2018set for a\nbreakthrough year,\u2019<\/em> with its new projections estimating growth of 8.2% in\n2021 and 6.1% next year, significant upgrades from the 6.0% and 5.2% previously\nforecast. <\/strong><\/p>\n<\/div>\n\n

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These upward\nrevisions largely reflect the previous relaxation of lockdown restrictions,\nrapid vaccine rollout and unleashing of pent-up demand. CBI Director General,\nTony Danker, commented, \u201cThere are really positive signs about the economic\nrecovery ahead this year and next. The data clearly indicates that there is\npent-up demand and ambition across many sectors.\u201d <\/em>Mr Danker added, \u201cThe\nimperative now must be to seize the moment to channel this investment into the\nbig drivers of long-term UK prosperity\u201d<\/em> and called on the government to\nproduce \u201cfar more detailed plans on everything from decarbonisation, to\ninnovation, to levelling up.\u201d<\/em>  <\/p>\n<\/div>\n\n

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Inflation above Bank target <\/strong><\/p>\n<\/div>\n\n

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The past seven days have also seen the Office for National Statistics\n(ONS) release a raft of economic data, including the latest inflation figures,\nwhich revealed the Consumer Prices Index (CPI) now stands above the Bank of\nEngland\u2019s 2% target. An increase in the cost of fuel and clothes pushed the CPI\nrate up to 2.1% in the year to May, significantly higher than April\u2019s 1.5%\nfigure and above all forecasts in a Reuters poll of economists. While most\npolicymakers still appear to believe upward price pressures will prove\ntemporary, the higher-than-expected inflation number inevitably fuelled further\ndebate about the future timing of interest rate movements.<\/p>\n<\/div>\n\n

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Retail sales dip<\/strong><\/p>\n<\/div>\n\n

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Last week also saw\npublication of the latest retail sales statistics, which reported an unexpected\ndrop in sales. According to ONS data, total sales volumes fell by 1.4% between\nApril and May, as people chose to visit reopened hospitality venues rather than\nbuying food at supermarkets. ONS commented, \u2018Anecdotal evidence suggests the\neasing of hospitality restrictions had an impact on sales as people returned to\neating and drinking at locations such as restaurants and bars.\u2019 <\/em>While\nstrong hospitality trade suggests the disappointing sales figure is not\nnecessarily an early sign of weaker consumer demand, some economists did point\nto other data revealing a fall in credit and debit card payments, and\nrestaurant reservations in early June, as evidence that the surge in spending\nmay be losing steam. <\/p>\n<\/div>\n\n

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Government borrowing eases<\/strong><\/p>\n<\/div>\n\n

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Public sector finance statistics, published\non Tuesday, showed that borrowing continues to fall from the mammoth levels\nwitnessed last year. In May, the government borrowed \u00a324.3bn; this was \u00a319.4bn\nlower than last year, although still the second-highest May number ever\nrecorded. Encouragingly, the figure was below analysts\u2019 expectations, with\nsigns that the recent economic recovery has started to boost tax revenues. The\ndata also revealed government debt now stands at almost \u00a32.2trn, or 99.2% of\nGDP, a ratio not seen since the early 1960s. In a statement, Chancellor Rishi\nSunak reaffirmed his commitment \u201cto support people and businesses to get\nback on their feet\u201d<\/em> but also stressed the need \u201cto get the public\nfinances on a sustainable footing\u201d<\/em> over the medium term. <\/p>\n<\/div>\n\n

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Fed signals earlier rate rise<\/strong><\/p>\n<\/div>\n\n

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Across the pond, last week saw the Federal Reserve vote to leave US\ninterest rates unchanged, although it did announce a further upgrade to its\ngrowth forecast, as well as a rise in anticipated inflationary pressures. The\nFed now expects the US economy to grow by 7.0% across the whole of 2021, up\nfrom its March prediction of 6.5%, while this year\u2019s inflation forecast has\nbeen raised to 3.4%, from 2.4% previously.<\/p>\n<\/div>\n\n

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The US central bank also brought forward\nits prediction for the first rise in interest rates. The \u2018dot plot\u2019 of policymakers\u2019 forecasts now\npoints to two rate hikes before the end of 2023; in comparison, a majority of\nFed policymakers had suggested the first hike would not come until 2024, at its\nprevious meeting held in March. <\/p>\n<\/div>\n\n

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Here to help<\/strong><\/p>\n<\/div>\n\n

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Financial advice is key, so please do not\nhesitate to get in contact with any questions or concerns you may have.<\/p>\n<\/div>\n\n

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The value of investments can go down as well as up and you may not get\nback the full amount you invested. The past is not a guide to future\nperformance and past performance may not necessarily be repeated.<\/strong><\/strong><\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

\u201cThere is pent-up demand and ambition across many sectors\u201d Last Friday, the Confederation of British Industry (CBI) published its latest economic forecast, which predicts UK GDP growth is set to bounce back to pre-COVID levels by the end of the year, despite the four-week delay in lifting all lockdown restrictions. The industry body said the […]<\/p>\n","protected":false},"author":12,"featured_media":1142,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[32,112],"tags":[],"hd_content_source":[],"_links":{"self":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/1141"}],"collection":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/users\/12"}],"replies":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/comments?post=1141"}],"version-history":[{"count":2,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/1141\/revisions"}],"predecessor-version":[{"id":1144,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/1141\/revisions\/1144"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media\/1142"}],"wp:attachment":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media?parent=1141"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/categories?post=1141"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/tags?post=1141"},{"taxonomy":"hd_content_source","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/hd_content_source?post=1141"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}