{"id":1255,"date":"2021-08-04T10:22:26","date_gmt":"2021-08-04T09:22:26","guid":{"rendered":"https:\/\/new.contentdeployment.co.uk\/tomd\/?p=1255"},"modified":"2022-07-05T14:11:07","modified_gmt":"2022-07-05T13:11:07","slug":"news-in-review-14","status":"publish","type":"post","link":"https:\/\/new.contentdeployment.co.uk\/tomd\/2021\/08\/04\/news-in-review-14\/","title":{"rendered":"News in Review"},"content":{"rendered":"
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\u201cOur economy is rebounding faster\nthan initially expected\u201d<\/em><\/strong><\/em><\/strong><\/p>\n<\/div>\n\n

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Last\nweek saw the International Monetary Fund (IMF) release its latest assessment of\nthe global economy. Among the headline stories was a sharp increase to this year\u2019s\nUK growth forecast, with the renowned international soothsayer now predicting a\n7% expansion \u2013 1.7 percentage points higher than its previous projection\npublished in April. This uplift was attributed to stronger than expected growth\nbetween February and April, due to the success of the UK vaccination programme\nand furlough scheme. Responding to the upgrade, Chancellor Rishi Sunak said, \u201cThere are positive signs that our economy\nis rebounding faster than initially expected.\u201d <\/em><\/strong><\/p>\n<\/div>\n\n

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Along\nwith the US, the UK rate was the joint-highest among the major advanced\neconomies. In total, growth across all rich nations is forecast to be half a\npercentage point above April\u2019s prediction. However, the latest IMF assessment\ndid highlight a worrying divergence in fortunes between rich and poor countries\ndue to differing levels of access to COVID vaccines. As a result, the overall\nglobal growth forecast for 2021 remains unchanged at 6%, with a weaker outlook\nfor many emerging market and developing economies offsetting gains across\nricher nations.<\/p>\n<\/div>\n\n

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US growth below expectations<\/strong><\/p>\n<\/div>\n\n

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While the US\neconomy is expected to witness strong growth this year, the latest gross\ndomestic product (GDP) figures released last Thursday fell short of market\nexpectations. According to the Commerce Department\u2019s advance estimate, the US\neconomy grew at an annualised rate of 6.5% in the second quarter. This was only\nslightly above the rate recorded in the first three months of the year and\nsignificantly below the consensus forecast of 8.5%. It did, however, move US\noutput back above its pre-pandemic level for the first time since COVID struck.<\/p>\n<\/div>\n\n

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Eurozone growth rebounds<\/strong><\/p>\n<\/div>\n\n

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GDP data published on Friday also showed the eurozone economy has pulled\nout of its pandemic-induced recession, with an initial second quarter growth\nestimate of 2%. This figure, which was better than economists predicted, was\nbuoyed by a particularly strong performance from the bloc\u2019s third and fourth\nlargest economies, Italy and Spain, which posted quarterly growth rates of 2.7%\nand 2.8%, respectively. Despite the second quarter rise, the eurozone economy\nremains 3% smaller than its pre-pandemic peak. The first estimate of UK second\nquarter GDP is due for release on 12 August.<\/p>\n<\/div>\n\n

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Eurozone and US inflation up<\/strong><\/p>\n<\/div>\n\n

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During the past\nseven days, both the eurozone and US statistics agencies published new\ninflation data. In the eurozone, an early official estimate suggests annual\ninflation rose to 2.2% in July from 1.9% in June. This was 0.2 percentage\npoints above market expectations and the highest rate since October 2018; it\nalso moved inflation above the European Central Bank\u2019s 2% target. <\/p>\n<\/div>\n\n

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In the US, the\nFederal Reserve\u2019s preferred inflation measure (core PCE) rose to 3.5% in the 12\nmonths to June, from 3.4% in May. While this leaves the rate well above the\ncentral bank\u2019s 2% target, it was actually 0.2 percentage points below analysts\u2019\nexpectations. A day prior to the inflation data release, the Fed announced its\ncurrent monetary policy stance would remain unchanged, with Fed Chair, Jerome\nPowell, reiterating his view that higher prices were the result of \u201ctransitory\nfactors\u201d <\/em>and therefore not an imminent risk to the US economy. <\/p>\n<\/div>\n\n

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Furlough numbers fall<\/strong><\/strong><\/p>\n<\/div>\n\n

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Official figures\npublished last Thursday showed the number of people on furlough at the end of\nJune stood at 1.9 million, more than half a million fewer than at the end of\nMay. The news came three days before the next phase of furlough tapering was\nintroduced, with employers having to contribute 20% towards employee salaries from\n1 August. Research published by the British Chambers of Commerce on Monday\nsuggests nearly one in five firms are considering staff redundancies in\nresponse to the furlough change.<\/p>\n<\/div>\n\n

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Housing market\ncools<\/strong><\/strong><\/p>\n<\/div>\n\n

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The latest\nNationwide House Price Index, released last Wednesday, revealed that annual\nhouse price growth slowed to 10.5% in the year to July, down from a 17-year\nhigh of 13.4% in the previous month. <\/p>\n<\/div>\n\n

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Stocks rally<\/strong><\/p>\n<\/div>\n\n

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After having\nbeen hit by concerns over China\u2019s tech crackdown last week, London stocks\nrallied at the start of the week; the FTSE 100 rose to a three-week high on\nTuesday afternoon, continuing its strong start to August, whilst the\ndomestically focused FTSE 250 reached another record high. <\/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":"

\u201cOur economy is rebounding faster than initially expected\u201d Last week saw the International Monetary Fund (IMF) release its latest assessment of the global economy. Among the headline stories was a sharp increase to this year\u2019s UK growth forecast, with the renowned international soothsayer now predicting a 7% expansion \u2013 1.7 percentage points higher than its […]<\/p>\n","protected":false},"author":12,"featured_media":1256,"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\/1255"}],"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=1255"}],"version-history":[{"count":3,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/1255\/revisions"}],"predecessor-version":[{"id":1368,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/posts\/1255\/revisions\/1368"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media\/1256"}],"wp:attachment":[{"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/media?parent=1255"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/categories?post=1255"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/tags?post=1255"},{"taxonomy":"hd_content_source","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/tomd\/wp-json\/wp\/v2\/hd_content_source?post=1255"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}