UK Consumer confidence slumps … were they all in Newcastle on Tuesday

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According to the latest GfK NOP survey, consumer confidence slumped in January as households worried about economic prospects for the year ahead. Household spending will be under pressure in 2011 as real incomes fall and discretionary income will be further squeezed by the January VAT increase.
The Bank of England still believes inflation will fall to target as the soup kitchens undermine retail food prices. And the Governor, still believes the economy is rebalancing towards net exports and away from consumption.
As a result of inflation and low earnings, real wages will be no higher than in 2005 and “one has to go back to the 1920’s when real wages fell over a period of six years.” said the Governor. As Tolstoy or Macmillan may have said “you’ve never had it so bad”. It certainly didn’t sound good.
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UK Consumer confidence slumps as they hear from the Governor …

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According to the latest GfK NOP survey, consumer confidence slumped in January as households worried about economic prospects for the year ahead. Household spending will be under pressure in 2011 as real incomes fall and discretionary income will be further squeezed by the January VAT increase.
The Bank of England still believes inflation will fall to target as the soup kitchens undermine retail food prices. And the Governor, still believes the economy is rebalancing towards net exports and away from consumption.
As a result of inflation and low earnings, real wages will be no higher than in 2005 and “one has to go back to the 1920’s when real wages fell over a period of six years.” said the Governor. As Tolstoy or Macmillan may have said “you’ve never had it so bad”. It certainly didn’t sound good.
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UK GDP – it’s the wrong kind of snow, at the wrong time of year

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The ONS estimates for GDP growth came as something of a surprise for the final quarter of 2010 with q on q growth down by 0.5%. Even more disturbing was the sight of the Chancellor of the Exchequer explaining how snow had derailed the economic recovery in the final month of the year.
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Retail Sales in December – take the food sales with a pinch of salt ….

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Retailers suffer worst December on record according to the Daily Telegraph as the retail sales figures for December were released by the Office of National Statistics. “British retail sales suffered their worst December on record as retailers battled with Arctic weather conditions and shoppers shunned higher prices.”
But food, what happened to food. Let them eat flake, or snowflakes presumably as food sales fell by 3.4% compared to December last year. That is the equivalent of one days destocking from the freezer as supplies came under pressure from families housebound. It is going to be a tough year ahead for retail, especially in household goods, retail sales were flat in December but the food figures should be taken with a pinch of salt.
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UK Growth will be stronger than expected in 2011 and private sector will create jobs.

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GROSS domestic product will be stronger than expected in 2011 and the private sector is set to create the job growth to offset spending cuts.
Every one percent growth in GDP will lead to the creation of around 100,000 jobs according to the research and growth should be above trend in the recovery process.

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