Howard Archer
Howard Archer
bank belief consumer england optimistic retail retreat stunning
This is a really stunning retreat in retail sales. It reinforces our belief that the Bank of England is too optimistic about consumer spending.
belief consumer february fourth performance quarter relatively seen spending strong survey sustain unable
The February CBI survey reinforces our belief that consumer spending will be unable to sustain the relatively strong performance seen in the fourth quarter of 2005.
belief case consumer growth healthy interest november picking rate retail sales spending
Pretty healthy retail sales growth in November reinforces belief that consumer spending is picking up to some extent, and reduces the case for a near-term interest rate cut.
bank belief consumer earnings employment england falling forecast growth hardly overall pressures remain rising softer supportive underlying
The combination of rising unemployment, falling employment and muted earnings growth is hardly supportive for consumer spending. It reinforces our belief that overall growth will be softer than forecast by the Bank of England and that underlying inflationary pressures will remain muted.
below data features headline positive
Below the headline data there are some positive features that should not be overlooked.
consumer equity mortgage peak reduced since spending weighed
The markedly reduced mortgage equity withdrawal since its fourth-quarter 2003 peak has undoubtedly weighed down significantly on consumer spending since mid-2004.
accelerate basis believe buyer doubtful floor higher highly house interest keeping likely move prices remain soon start sustained thereby time
This is likely to put a floor under house prices, but we remain highly doubtful that house prices will move substantially higher on a sustained basis any time soon. If house prices start to accelerate markedly, we believe buyer interest will soon diminish, thereby keeping a lid on prices.
boosts clear coming december demand domestic economic hopes improvement kick months sentiment support
The clear improvement in economic sentiment in December boosts hopes that domestic demand will increasingly kick in over the coming months to support growth.
appears chain contain continuing effects energy high oil pressures round second street strong supply
It appears that strong competitive pressures on the high street and through the supply chain are continuing to contain any second round inflationary effects of high oil and energy prices.
activity adds annual buyer cent climb degree evidence house housing increased inflation limited low market november october per price prices recent recently reported stronger
The climb in annual house price inflation to 2.5 per cent in November from a nine-year low of 1.8 per cent in October reported by the ODPM adds to the recent evidence that house prices have firmed to a limited degree recently amid stronger housing market activity and increased buyer interest.
appears boost needed sales
It appears that significant discounting is still needed to boost sales volumes.
borne case christmas consumer cut early emerging hard healthy interest picture rate reasonably seems spending underlying
The underlying picture that seems to be emerging is that consumer spending will be reasonably healthy over the Christmas period. If borne out by hard data, this dilutes the case for an interest rate cut early in the New Year.
budget economic key low seems terms
In economic terms at least, Wednesday's budget seems set to be a very low key affair.
data gains house prices provides sharp support sustain time unable view
The Nationwide data provides support for our long-held view that house prices will be unable to sustain sharp gains for some time to come.