I suppose that the best thing we can say about this morning’s announcement on Q1 GDP (still 0.5%) is that there weren’t really any surprises. The economy is still very much dependent on its life support machine and it seems that there was no significant catch-up on production lost due to the “exceptional weather” we had in December 2010. The huge importance of the business services
and finance sector is underlined once again and whatever we think of the banks, ‘Flatline George’ has a difficult job in ensuring that any additional
regulation does not jeopardise their ability to function strongly. Manufacturing at 1.1% is reassuring and although the offset from falling energy production etc., may ring alarm bells for the future contribution of the sector it does at
least look like mainstream manufacturing is alive and well in the toughest of
conditions. Any reliance on increased consumer spending in the near future will
most certainly be unrewarded and I wouldn’t be surprised to see the loss of one
or two more high-street brands before the year is out. See http://www.statistics.gov.uk/cci/nugget.asp?id=192
for the summary.