Howard Archer
Howard Archer
drag expansion fourth growth major modest overall quarter sector
The sector may see modest expansion in the first quarter of 2006, having been a major drag on overall growth in the fourth quarter.
boost europe feed growth hoping improving recent signs sustained uk western
Going forward, UK exporters will be fervently hoping that recent signs of improving growth in Western Europe will be sustained and will increasingly feed through to boost exports,
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.
deter euro further growth hike interest likely march raising rates remains zone
The slowdown in euro zone growth will not deter the ECB from raising interest rates in March and a further hike remains very likely in June.
act appears august bank currently england evidence given growth quarter risen seems survey unlikely
The Bank of England currently seems unlikely to act before August given that growth in the first quarter appears to have been around trend, while survey evidence indicates that inflationary expectations have risen recently.
boost euro feed growth healthier hoping pound recently softer zone
Manufacturers will be hoping that healthier growth in the euro zone and a recently softer pound will increasingly feed through to give them with a significant boost in 2006.
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.