Wednesday, 8 December 2010

UK retail sales slow but manufacturing accelerates

Economic data from the UK have been mixed recently.

Retail sales slowed slightly, according to a Bloomberg report.

U.K. retail sales climbed in November as higher food-price inflation pushed up values and cold weather boosted demand for clothing and footwear, the British Retail Consortium said.

Sales at stores open at least 12 months, measured by value, rose 0.7 percent from a year earlier, compared with a 0.8 percent gain in October, the London-based BRC said in an e- mailed statement today. Excluding the impact of a sales-tax increase in January, underlying volume sales growth is “virtually zero,” it said.

Shop price inflation also dipped in November, Reuters reports.

British shop price inflation dipped in November as retailers offered discounts in the run up to Christmas, but it is likely to rise in 2011 due to a hike in VAT and expected higher energy costs, data showed on Wednesday.

The British Retail Consortium said shop price inflation had eased in November to 2.0 percent from 2.2 percent in October as food inflation slowed for the first time in five months.

But Reuters also reports better employment growth in November.

Employment for both permanent and temporary staff in Britain grew at its fastest pace in three months in November, though pay growth remained weak, the Recruitment and Employment Confederation said on Wednesday...

The permanent placements index rose to 55.2 in November from 52.6 in October, hitting its highest since August. November's temporary staff billings index also hit a three-month high, increasing to 53.5 from 51.6. Readings above 50 indicate expansion, and those below mean contraction.

And strong growth in manufacturing has helped keep the UK economy growing. Again from Reuters:

Manufacturing output rose twice as fast as anticipated in October but wider industrial production unexpectedly fell, suggesting the pace of economic growth slowed early in the final quarter...

Manufacturing output rose 0.6 percent in October, according to figures from the Office for National Statistics on Tuesday, three times September's gain and the biggest monthly rise since March.

However, sharp falls in mining, utilities and oil and gas extraction pushed industrial output down 0.2 percent on the month after September's 0.4 percent rise, confounding expectations for a 0.3 percent increase...

Britain's GDP grew 0.8 percent between July and September, according to official data, and the National Institute of Economic and Social Research think tank said on Tuesday it thought the economy had grown by 0.6 percent in the three months to November.

That compared with its estimate of a 0.5 percent rise in the three months to October and 0.8 percent in the three months to September.

Elsewhere in Europe, manufacturing has also been strong in Germany. From Bloomberg:

German factory orders rose in October as domestic demand picked up, another sign the country’s economic recovery is broadening.

Orders, adjusted for seasonal swings and inflation, increased 1.6 from September, when they fell 4 percent, the Economy Ministry in Berlin said today. Economists expected a 1.9 percent gain, according to the median of 40 estimates in a Bloomberg News survey. From a year earlier, orders climbed 17.9 percent when adjusted for working days.

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