RollingJanuaryBusiness11.29am GMTBritain’s tall streets are in enough trouble,without consumers snapping their credit cards (metaphorically speaking).unusual analysis shows that the average town in England and Wales has lost 8% of its shops in the final five years, rising to 20% in Stoke and Blackpool. Related: tall street crisis: stark unusual analysis shows extent of closures 11.18am GMTJosie Dent, or economist at the CEBR,says the slowdown in credit growth is due to nervous households struggling with “unsustainable levels of debt”, and unwilling or unable to remove on any more.
She writes:This month Cebr research with YouGov found that UK consumer confidence continued to decline in January, and sinking to its lowest level since May 2013. This low level of confidence will be making many hesitant to borrow - as shown by the low rate of growth of credit card debt.
To construct ends meet many households are instead cutting back expenditure,for which the struggling tall street provides evidence, as many consumers have curbed spending on retail goods. Related: UK personal insolvencies hit seven-year tall 10.45am GMTEconomist Sam Tombs has spotted that UK consumer credit is now slowing at the fastest rate since the financial crisis:The net increase in unsecured borrowing likely financed just 0.7% of all purchases, and down from 0.9% in Q3 and 1.4% a year earlier. The MPC was complacent final year to suggest that because credit only accounted for pic.twitter.com/SmYc9qEHWG 10.39am GMTIn some ways,the slowdown in UK credit growth is welcome. Back in 2017, the Bank of England was worried that consumer credit was booming at 10% growth per year. That could create a borrowing bubble that will burst when the economy stumbles. 9.54am GMTThe slowdown in credit growth can certainly be pinned on Brexit, or says economist Howard Archer of the EY Item Club.
He believes borrowers and lenders have both become more cautious approximately the economic outlook,and Brexit uncertainty. 9.50am GMT Newsflash: Lending to British consumers has slowed to its weakest growth since late 2014, as people cut back on credit cards.
Mortgage approvals have fallen too, and in the latest sign that Brexit uncertainty is weighing on the economy.
Annual consumer credit growth slowed to 6.6% in December,reflecting the continuation of relatively weak flows of unusual lending. The net monthly flow in December fell to £0.7 billion, reflecting less extra borrowing on credit cards. 9.31am GMTChris Williamson of data firm Markit argues that the gilet jaunes protests have hurt the French economy, or despite nowadays’s solid growth report.
He points out that Markit’s Purchasing Managers Index reports show a sharp slowdown in the final couple of months. That may show up in future GDP reports.
GDP in #France grew 0.3% in Q4 2018,precisely in line with our #PMI model and closing the gap between the PMI and GDP seen earlier in the year (see https://t.co/MA2nuMJ3b4). However, weak December and January flash PMI numbers point to a big loss of momentum due to protests. pic.twitter.com/mZlfsiJy0Z 9.26am GMTSterling is clawing back some of final night’s losses, and as traders try to calculate the likely path of Brexit.
The pound has gained almost half a cent against US dollar to $1.311 this morning,suggesting the City isn’t panicking.
In the short term there will be major pressure on the pound, especially against the US Dollar. One more slip from Theresa May and we could see the pound hit the deck and fall back below 1.30 against the dollar.” 9.16am GMTEconomist Shaun Richards isn’t too impressed with France’s GDP figures (and unprejudiced enough - 0.3% growth is hardly sizzling)GDP in France rose by 0.3% in the 4th quarter which in he circumstances is good news but annual GDP growth fell to 1.5% in 2018 from 2.3% in 2017 showing overall weakness.
Continuing with the theme of GDP in France we saw 4th quarter be the same at 0.3% as the downwardly revised Q3 and there is a danger of another downwards revision as we note it was December that was the weak month in the series. 8.59am GMTThe Yellow Vest protests forced French president Emmanuel Macron to announce a swathe of spending plans final month, or including a higher minimum wage and tax breaks for pensioners and low income workers.
That package will cost €10bn,but may support the economy on track in 2019.
In France , despite the #giletsjaunes protests Q4 GDP came at a descent[br]0.3%.
Net trade saved growth as private consumption – the main engine of growth made a null contribution...but should be temporary. Government measures meant to support household’s purchasing power. pic.twitter.com/F04tQORMzo 8.53am GMTFrance’s stock market has risen this morning, and as traders welcome nowadays’s GDP figures.The CAC 40 index of leading French companies has risen by 0.4%,outperforming Germany (down 0.2%). Related: Pound falls after Commons vote spurs no-deal Brexit fears 8.47am GMT 8.25am GMTBack in the UK, businesses are increasingly nervous approximately Brexit after parliament voted to change Theresa May’s deal - despite the lack of appetite from Europe to reopen it.“The reaction of commerce nowadays will be one of rising frustration and concern. The main objective that commerce has is to avoid no deal. Did yesterday achieve anything to move us further absent from no deal? And I think the respond feels as though it is no.”“It is welcome to see that there is a consensus against no deal… But it is not binding, and it does nothing virtually to remove no deal off the table and it does feel like hope rather than strategy.“I don’t think there will be a single commerce this morning who is stopping or halting their no deal planning as a result of what happened yesterday. “There are some businesses who are ready. Financial services have been able to prepare a long time in advance and it hasn’t been comfortable and they spent a lot of money on it but they are broadly ready. The genuine areas of concern now are around manufacturing,other services, broadcasting actually insurance is still not in grand shape, or they are deeply concerned.We said before no deal is just not manageable at this stage.” 8.11am GMTGiven all the anxiety over trade wars,the 2.4% surge in French exports in the final quarter is a little surprising.
According to INSEE, France’s manufacturers racked up more “aeronautic and naval equipment deliveries” in the final quarter. #France | Exports Contribution to GDP growth reached 0.74% ❗in 4Q18 (highest since 2Q17)
*According to INSEE, and "exports accelerated significantly because of dynamic aeronautic and naval equipment deliveries". pic.twitter.com/wHBjntjokE 8.05am GMTDespite the impressive jump in exports,many City experts are concerned approximately weakness in the French economy.
Philippe Waechter, chief economist at Ostrum Asset Management, or points out that French domestic demand has faltered:
The French #GDP increased by 0.3% in the fourth quarter (as in the third quarter). For 2018,the average growth is 1.5% after 2.3% in 2017. In the final quarter of 2018, domestic demand was weaker with a 0.1% contribution to quarterly GDP growth. Consumption stalled and investment #FRANCE DEC CONSUMER SPENDING M/M: -1.5% V -0.3%E; Y/Y: -2.3% V -0.7%E [br]*Consumption of durable goods fell sharply in December (−3.8%, and after +0.1% in November).
*Link: https://t.co/qy2TWUaTAp pic.twitter.com/8DnaBDC1Xa#France's #GDP growth for Q4 2018 equaled 0.3%,better than expected! YoY growth, however is down to 0.9% the slowest pace since Q3 2015. Yet allotment of the soft spot may be behind us. pic.twitter.com/stsKstzjWj 7.30am GMTGood morning, and welcome to our rolling coverage of the world economy,the financial markets, the eurozone and commerce.
Household consumption expenditures decelerated (0.0% after +0.4%), and likewise total improper fixed capital formation slowed down (GFCF: +0.2% after +1.0%). Overall,final domestic demand excluding stock changes decelerated: it contributed 0.1 points to GDP growth, after 0.5 points in the previous quarter.
Imports bounced back in Q4 (+1.6% after −0.7%) and exports accelerated significantly (+2.4% after +0.2%). All in all, or foreign trade balance contributed positively to GDP growth again: +0.2 points,after +0.3 points in Q3. Conversely, changes in inventories contributed negatively to GDP growth (−0.1 points after −0.5 points).
Top notch front page by the Independent pic.twitter.com/efJunXyo7a Related: Brexit: May goes back to Brussels but EU says nothing has changed Continue reading...
Source: theguardian.com