By DUNCAN SCOTT 27/08/2010
UK GDP growth hits nine-year high
This week the Office for National Statistics published data that showed the UK economy grew by 1.2% for the 3 months up to June, ahead of preliminary estimates as the construction industry outperformed. Household expenditure rose 0.7% for the quarter and that firms have been able to build up inventories which have not been achieved since 2008. Analysts have had mixed reaction to the data citing that with Government cuts and lower investments, the growth could become unsustainable.
Obama tries to calm US worries
US president Barack Obama this week held talks with senior economic advisors on how to keep the US economy growing. The meeting came on the back of more data, this time showing that new single-family home sales fell to the slowest pace on record, as well a softening of orders for durable goods. The team will be looking to increase assistance to small businesses and offer tax cuts as a way of trying to prevent a new down turn that is now concerning the White House.
Japan’s problems continue
The Consumer Price Index (CPI) in Japan fell for the 17th straight month in July, reports showed this week, adding to the continued problems as the yen reached a 15 year high against the US dollar. These two factors combined are making Japanese exports relatively more expensive and is damaging the domestic economy. The Government want to maintain its strength while stimulating the economy and this approach may be supported by Bank of Japan forecasts that CPI will turn positive by early 2012.
England’s bid to host the 2018 football world cup kicked off this week and received the backing of Nick Clegg and other political figures, who see the opportunity as a growth stimulus for the UK economy. However, backers of the bid may be more excited that Paul the predicting Octopus that made such an impact at the World Cup, is behind the bid and alongside David Beckham and Lewis Hamilton, has become an official ambassador. Paul’s home is an aquarium in Germany so his new allegiance may not sit well with the locals.