UK GDP grew by a 2.8% in the third quarter year on year following 1.6% growth in the second quarter. The economy is on track to post growth in the full year of over 1.6%. For the spending review, the economy will recover despite government policy. Cerdic the Saxon king said of King Arthur “finally, a man worth killing”. The Chancellor appears to have discovered a recovery of similar ilk. JKA.
UK GDP grew by a 2.8% in the third quarter year on year following 1.6% growth in the second quarter. The economy is on track to post growth in the full year of over 1.6%.
pro.manchester.connectomics is the process to map the Greater Manchester connectome of innovation, enterprise, advice and finance. Everyone can help. If your organisation is in this neural network, then dial into the connectomics process and ensure you are plugged into the Greater Manchester neural network that will become pro.manchester.connects.
CPI inflation in September was 3.1% unchanged from the figures recorded in July and August. Service sector inflation fell to 3.7% from 4.0% but goods inflation increased from 2.4% to 2.6%. This is not a deflationary scenario explained by an output gap but an inflationary environment exacerbated by a weak outlook for Sterling.
World trade has recovered to the high levels of 2008, according to the latest data (July 2010) from the CPB Netherlands Bureau for Economic Policy Analysis,. Over the seven year period from 2002 to 2008 the trend rate of growth was 7% per annum before a dramatic plunge in 2009 as trade volumes fell by 20%. Since the nadir, the recovery rate of growth has been 14.5% on an annualised basis to bring volumes within 1% of the 2008 high.
GDP in the second quarter increased by 2% year on year basis demonstrating a strong recovery following the almost 5% fall in 2009. Furthermore NIESR estimates of growth in the third quarter suggest a further recovery of 2.5% growth in the third quarter. For the year as a whole growth of 1.5% rising to over 2% in 2011 seems to be a realistic forecast, with no double dip in prospect. The recovery is on track to effect a dramatic cyclical adjustment to the borrowing figures without the need for draconian action in the October spending review.
The output gap will have no bearing on overall inflation despite the antiquity of the Bank of England Inflation model. Inflation will remain above target unless base rates rise to impact on Sterling appreciation leading to a reduction in import prices levels. Even then a revised target of 2.5% would be difficult to achieve.
Overall the results for September demonstrate the impact of world wide commodity price rises and the fall in Sterling values as they impact on imported inflation. The output gap has no compression vale on input and output prices other than some disabling of domestic margins.
As the world economy recovers into 2011, with anticipated growth of over 4%, additional pressure on commodity prices especially oil are inevitable as increasing demand from the BRICs accelerates the process.
We want to create an eco system for innovation and enterprise in Greater Manchester, a system where entrepreneurs can flourish and thrive, a system in which innovation and enterprise can find access to advice and finance, linking the thinking. But what do we mean by an eco system with engineers and architects? Sue Woodward is a great example. pro.manchester.connects. JKA
Not all investors stories in the USA are about two kids in a garage developing the next “LinkBook”, “FacedIn” or Boogle” software package meeting up with a Silicon Valley mogul advancing millions of dollars electronically transferred from a luxury yacht somewhere in San Francisco Bay based on a one page business plan projecting revenues of $100 million dollars by year five. Scott Shane’s contribution to the research into innovation and enterprise is important. The more realistic the information provided and the fewer myths are allowed to endure, policy decisions and ambitions of investors and entrepreneurs alike can be more focussed and aligned. JKA