19 May 2017
This UK continued to outperform expectations with stunning new unemployment figures, rising office space, and booming business activity; trouble in Europe continued as Italian debt rocketed; but the ECJ boosted hopes for a trade deal with the UK by eliminating vetoes by national parliaments as global ambassadors talked up the UK’s position for global trade.
Commentators were stunned this week when UK unemployment hit its lowest level for 40 years with a mere 1.54m people unemployed – down by 53,000 in the three months to March. The statistics also showed a record percentage of women in work, with 70.2% of those between the ages of 16 and 64 in employment. Figures were even higher for men with 79.5% in work – the highest since 1991. The unemployment rate also fell among young people, sitting at 12.5% for 16 to 24 year olds – lower than the comparable figure of 13.7% in the same period last year.
We were handed another reminder of the wisdom of our vote to quit the EU this week as it emerged that Italian debt has reached record highs of £1.94tn in March. The revelation comes alongside a slump in GDP growth, with the country being described as the “weakest link” in the Eurozone by a leading financial commentator, who went on to warn that Italy’s chance of default “remains at an elevated level”, while the European Commission warned that the debt mountain was “a major source of vulnerability” for the currency union.
Business activity surged last month, growing at its fastest rate all year despite the Brexit naysayers warning that Article 50 could bring the economy to a halt. The data comes from Lloyds Bank’s latest regional PMI report, which establishes the extent of growth in business activity by measuring orders on private sector books. It showed manufacturing and services hitting four month highs in the month of April. It produced a reading of 57.1, where any figure above 50 indicates growth.
No wonder that construction of office space is booming according to a new survey from Deloitte. 28 new projects were started during the period, with construction of new office space looking to reach its highest level since 2003. So much for Brexit hitting London businesses.
Retail is performing healthily too, with a 2.3% rise in sales smashing pessimistic economic forecasts which predicted a mere 1% spike and outperforming the volume of sales enjoyed during the same period last year by 4%. The news comes as part of a wider picture of enthusiasm among British consumers and renewed interest among foreign tourists, with Britain welcoming the most tourists in its history last year as 7.6 million flocked to enjoy our country.
Expect retail sales to remain song with Swedish furniture giant Ikea planning huge expansion involving the creation of 1,300 new jobs and three new stores by the end of 2018.
Meanwhile Britain got a rare piece of good news from the European Court of Justice as it was confirmed that national parliaments lack the power to veto the vast majority of terms of a trade deal agreed by the European Union and external third parties – meaning that British negotiators will have a significantly easier time striking a trade deal with the EU as an independent country. It seems the CEO of Vodafone, Vittorio Calao, may be right to be optimistic about a post-Brexit trade deal. He said this week that “pragmatism should prevail”. Wise words.
But it isn’t only the European Union who are now more open to post-Brexit deals with the UK. Ambassadors from Brazil and China have both stressed the importance of Britain to their future economic strategy, with Eduardo dos Santos saying that “the conditions are ripe for British and Brazilian entrepreneurship to flourish” and Liu Xiaoming stressing the centrality of the UK to their ongoing development.
12 May 2017
As interest rates held, Bank of England governor Mark Carney confirmed that Brexit could see solid UK growth continuing despite earlier warnings. New figures showed acceleration in manufacturing leading to economic rebalancing. SoftBank invested $500bn in a great British startup while Aldi mulled huge plans for UK expansion. Business confidence was on the rise and financial services received good news as the US warned the EU against punishing the City, the CEO of Barclays refuted claims that Brexit will produce a jobs exodus, and a huge Canadian fund with a $6bn war chest moved its EU hub to London.
Bank of England governor Mark Carney yesterday spoke out, holding the interest rates at their existing level while admitting that an orderly withdrawal from the European Union would allow Britain to continue enjoying healthy growth despite pre-referendum warnings about a slowdown should we back national independence. It comes as Britain shattered BoE estimates in 2016 and stood out as one of the best performing advanced economies last year. The intervention came with a boost in 2018 and 2019 growth forecasts to 1.7% and 1.8% respectively.
Meanwhile new data shows the UK on course for much needed economic rebalancing with accelerating growth in manufacturing in the second quarter of the year pointing the way to lessening dependency on the services sector – which pulled for weight for almost all economic growth in 2016.Allie Renison of the Institute of Directors encouraged optimism about rising exports, reminding commentators that “the overall pattern since the referendum has been on the increase”.
A major British tech startup has gotten good news too, winning over half a million dollars in investment from the Japanese group SoftBank. The massive investment decision, rewarding the VR firm Improbable which is only five years old, marks one of the largest investments made in a European tech startup.
But it isn’t only startups that are doing well. Aldi is set to launch a huge expansion programme in Brexit Britain too, with plans to expand their current 700 stores to 2,600 locations – almost quadrupling in size. Just more evidence that major players are seeing Britain as a great place to do business.
The latest data from the ICAEW UK Confidence Monitor shows business confidence in the UK leaking in the second quarter, to 6.7 from -8.7, with optimism being felt on balance in 9 out of 11 regions across the country. The group’s director of business, Stephen Ibbotson, said that “it’s encouraging to see that confidence is starting to rise after a sustained period of decline.”
And the Remainer scare stories about Brexit’s effect on the City of London have been quashed as Jes Staley, the CEO of Barclays, has confirmed that there’s no reason for our withdrawal from the crumbling European Union to lead to an exodus of jobs to Europe. He referred to Brexit as “a wholly manageable challenge” and that “compared to the complexity of standing up our US intermediate holding company…let alone establishing a ringfenced bank in the UK from scratch…any of the options we might need to pursue are by comparison straightforward.
It comes on the same week that the powerhouse United States warned the EU against attempting to punish Brexit Britain by withholding Euro clearing rights. The country’s top derivatives regulator warned against disruptions, with Mr Giancarlo saying that “this is an important regulatory policy decision that needs to be made with care by European officials”. No shock then that financial business from around the world continues to flood into the UK with a major Canadian fund setting up its EU base in Brexit Britain this week. The Canadian Public Sector Pension Investment Board, with a $6bn to spend in the region in the next five years, has been chosen because it “has the financial infrastructure and network that would be hard to replace elsewhere”. Rare common sense.
5 May 2017
Economic news this week was dominated by the EU’s latest demand that the UK fork over a €100bn exit bill, with commentators pointing to increasing desperation from Brussels. Meanwhile new PMI data showed the UK going from strength to strength.
Even the European Union’s chief Brexit negotiator, Michel Barnier, had confessed that Brussels tough talk on the UK’s exit bill is motivated by a position of weakness, warning that the bloc faces a huge crisis if British leaders grow a backbone and refuse to hand over the cash. “The situation might be explosive if we have to stop these programmes”, he said. “Can you imagine the political problems which might arise?”
In that case he must be terrified of recent noises from Westminster with even cautious pro-EU Chancellor Phillip Hammond joining the rising chorus of Brexiteers in saying that the demand should be ignored. The Chancellor, dubbed “Spreadsheet Phil” by colleagues, said: “I don’t recognise this number. I genuinely don’t recognise it. It’s moved by 60% in the space of a few days”.
EU desperation is growing palpable even among the bloc’s most ardent supporters. The Confederation of British Industry has even chimed in, telling both sides to avoid getting bogged down in discussion of a petty exit bill and focus instead on a mutually beneficial trade pact. Common sense, but Brussels has never been known for heeding it.
Meanwhile the British economy goes from strength to strength with the latest batch of monthly PMI surveys – showing the extent to which private sector ordering books are expanding – showing that the country’s major sectors are growing at a remarkable pace. All-sector PMI accelerated from 54.6 to 56.0 with any figure over 50 indicating expansion. It marks the second highest reading in almost two years and a four month high, proving that Brexit Britain continues strongly with the triggering of Article 50 last month.
Manufacturing grew at its fastest since January and services and construction both saw their best growth of 2017, with much more to look forward to as we quit the crumbling European Union. Once again commentators have pointed to the new value of sterling as a major spur to increased activity in manufacturing and services in particular.
Agriculture can expect a boost from Brexit too, with the European Union Committee of the House of Lords hailing Britain’s chance to help farmers by quitting the failed Common Agricultural Policy. Its latest report points to new freedom to focus on our own priorities in the sector and end the mad bureaucratic mess that misdirects financial support to wealthy landowners. It went on to back the UK’s strength in Brexit negotiations, stressing that it enjoys “a strong position during trade negotiations for those products both with the EU and, after Brexit, the rest of the world”.
28 April 2017
Another strong fortnight for Brexit Britain as property booms, car production hits massive highs, the financial sector continues to create jobs, deal-makers back the country, and macroeconomic performance outdid the pessimistic expectations of so-called “economic experts”.
Britain is set to enjoy a spate of house building as registrations with the National House-Building Council shot up 17 percent in April, marking a ten year-high in house-building plans. 157,898 new homes were registered in the last financial year, up on the figure for the year prior. The news came as the Royal Institution of Chartered Surveyors highlighted a rise in demand for commercial property, with chief executive Simon Rubinsohn saying that “the forward-looking indicators are also proving relatively resilient”.
Small construction firms are also feeling the benefit of Brexit as they enjoyed rising workloads in the first quarter of the year. The news came from a new survey by the Federation of Master Builders, with one in two firms seeing rising work and only 5% seeing a decrease.
Car production also saw its best month in more than a decade and a half as demand for British cars abroad soared. The 7.3% rise saw the number of cars rolling off British production lines rise to 170,691. What a wake-up call after Brexiteer John Redwood was mocked for telling Brits to buy what the Guardian dubbed as “non-existent British cars”.
The financial sector also failed to succumb to the outrageous predictions of the Project Fear campaign as the number of jobs in sector in London grew by 17% in March compared to the month prior and 13% year-on-year. The Morgan McKinley London Employment Monitor showed a job spurt being caused by big vacancies in regulatory finance, fintech, and risk management.
Business leaders were also quick to praise the government for bringing clarity to the Brexit issue by calling a general election. Major figures from the City were quick to hail the decision including Sir Martin Sorrell, the chief executive of a major FTSE 100 company, who said that “when you think of the difficulty she faces in negotiating with the EU and the apparent divisions and weakness in the Labour Party you can see the logic”.
Britain has also gotten a boost from the confidence of global dealmakers as the country reclaimed a top five position in a ranking of nations that are attractive to deal-makers. The report from consulting firm EY showed the country as the third most important in the world for M&A, below only China and the United States.
The anti-Brexit IMF has boosted its growth forecast for Britain yet again, reversing its pessimistic projections. The group now says that the economy will grow by 2% in 2017, up from the 1.5% predicted in January. It’s quite a change from IMF head honcho Christine Lagarde’s claim that a vote to quit the EU would be something between “pretty bad to very, very bad”. She wasn’t the only person who was left with egg on their fact after it emerged that the rigged Treasury analysis of Brexit dangers was totally off base, with only two of nineteen predictions coming true. Thank goodness George Osborne will be quitting parliament and sparing us his lies.
Even anti-Brexit Bank of England chief Mark Carney has hailed fresh Brexit opportunities in a massive U-turn, hailing Britain’s opportunity to set a new agenda in regulation that can protect the global economy from another financial crisis akin to that which struck in 2008. He went on to downplay Brexit fears, saying that “I am more positive about the prospect of continued cooperation and building a more effective system”. The U-turn has been echoed by another major Bank of England figure, as economist Michael Saunders admitted errors in GDP forecasting and suggested that “UK expansion has developed greater momentum and resilience” than previously thought.
14 April 2017
Booming exports cause experts major embarrassment.
Britain’s booming exports were yet again a source of good news as the trade deficit was shown to have shrunk since out vote for Brexit, lifting small business confidence and forcing economists to hike growth forecasts as manufacturing exports hit a two-year high; discredited economic “experts” attacked the Treasury for bringing their profession into disrepute over gloomy Brexit forecasts; Ford reiterated its faith in Brexit Britain while JD Sports saw profits boom by more than 80%; analysis showed how successful global trade can be as an India trade deal was valued at £2bn; banks boosted UK hiring despite threats to do otherwise; Britain’s tech sector was shown to have enjoyed a huge post-Brexit boom; and the value of sterling was shown to boost the services sector as Travelodge set out its ambitious plans for Brexit Britain.
Economic experts at the EY Item Club have hiked forecasts for Britain’s economic growth this year from 1.3% to 1.8% as they recognise the fact that the new value of sterling and the evaporation of fears about Article 50 notice will lead Britain to an export and spending boom that pessimists had failed to predict. Major banks have hiked forecasts too, with JP Morgan now saying that Britain will grow at 1.9% this year.
The news is especially good for small businesses who have seen their confidence soar as the Brexit process begins. The Federation of Small Business showed confidence at its highest since the end of 2015 – much higher than the months immediately following the referendum – with net 16% reporting a rise in exports in the last quarter. No wonder that the country’s trade deficit in goods and services shrank to just £8.5bn in the first quarter of 2017 according to the ONS. The British Chambers of Commerce now show manufacturing exports growing at their fastest pace in two years as services continue to move steadily.
Article 50 seems to be provoking a lot of re-evaluation across the board with City of London policy chief Mark Boleat now admitting that the future is “looking rather better” now that our exit from the EU is essentially guaranteed. He once backed Remain but has now woken up to the ridiculous delusion of Remoaner scaremongering. He isn’t alone though. Professional economists are now pointing the finger of blame at elite institutions like the Treasury for bringing their discipline into disrepute through skewed, unreal predictions in the run up to the vote. What a disgrace.
The CEO of Ford, Mark Fields, has reiterated his commitment to Brexit Britain while calling for a mutually beneficial trade deal between the UK and the European Union upon Britain’s exit from the crumbling bloc. He was clear that the automotive giant would be in the UK for “quite some time” – joining Asian giants like Nissan and Toyota – while stressing that “we are very proud to be in the UK”. Given Britain’s booming business environment, with firms like JD Sports seeing their profits leap by 80% this year, why wouldn’t they be committed?
And just imagine how much more attractive we’ll be once we quit the EU. Just this week a major analysis valued a trade pact with India at £2bn, highlighting the huge opportunity we have on the world stage once we’re unshackled from dysfunctional EU trade policy. With cultural ties to the subcontinent, why shouldn’t we be doing business with booming allies all over the world?
Recruiter Robert Walters has confirmed that banks are increasing UK hiring despite empty threats to move jobs to the continent in the latest revealing news to destroy Project Fear referendum myths. “We’re not hearing any talk that anybody is going to move. We haven’t had any requests for hiring in any of our centres” he said, referring to foreign operations in Frankfurt, New York, Paris, and Amsterdam.
Tech firms are expanding in the UK too with 5,995 new firms opening in the eight months since we voted for national independence – a massive increase on the 2,325 that launched in the same period before the vote. As in banking, Brexit is doing nothing to dampen expansion in the tech sector.
Expect lots of activity over Easter too as the value of sterling lures tourists to enjoy the UK during the period. Overseas flight bookings have risen by nearly 50% according to eDreams ODIGEO with particularly strong growth moving out of London towards Edinburgh and Manchester. Dana Dunne of the firm said that “London has always been a favourite destination for travellers from around the world…What’s really encouraging is that inbound arrivals are also up for cities across the country, including Edinburgh and Manchester”.
But increased spending isn’t only coming from abroad with new data from Barclaycard showing that spending on a range of services including hotels and restaurants was 12% higher in March 2017 than a year prior. Travelodge are clearly seeing the upside too, announcing an ambitious plan to open 60 more hotels in the UK over the next three years to ride the Brexit wave – creating 1,500 new jobs.
7 April 2017
Productive trade talk, productivity rises, and bullish investors. Another strong week for Brexit Britain.
As it emerged that Britain may be entitled to money from the EU rather than having to settle a bill to leave, news emerged that Canada was already engaged in informal trade talks with the UK as the benefits of free trade with the US were revealed and the Prime Minister remained optimistic about Britain inheriting existing trade deals; reams of good economic data came out this week with productivity finally overtaking pre-crash levels, sterling boosting British exports, and services growing at a three month high; ASOS reported a huge sales surge in Brexit Britain; investors remained upbeat as tech start-ups continued to boom and financial giant JP Morgan did a U-turn on threats to take jobs out of London; home owners got good news as house prices remained set to rise 4.4% despite Brexit talks; and iconic company Cabdury brought Dairy Milk production back to the UK.
After weeks of empty talk about the UK owing huge sums of money to Brussels, with pro-EU Quislings like Peter Mandelson going to bat for the European Union against Britain’s interests, the British taxpayer will be relieved to hear that the UK may in fact be due money from the EU rather than being in debt. The money will be based on calculations for Britain’s share of massive EU assets including £9bn of funds held in the European Investment Bank and another £14bn from property, cash, and investments.
Meanwhile Britain’s future is looking incredibly bright outside of the mad European Union as the pressure group Leave Means Leave revealed the huge consumer benefit that can come from a comprehensive deal and reminded voters that it could happen within six months of quitting the EU. But the United States isn’t the only North American ally that Britain is set to deal with as it emerged that Commonwealth allies in Canada are already in informal talks with the UK as trade minister Francois-Philippe Champagne confirmed that there was nothing stopping Brexit Britain from initiating talks with third parties.
But talks, formal or informal, may be barely necessary in the case of many global trade partners as the Prime Minister insisted that the UK is free to inherit up to 50 existing trade deals struck while we were members of the European Union. Such a move would give us access to global markets in places like South Korea and Mexico, maintaining Britain’s global reach.
After nearly a decade of low productivity following the financial crash, Britain’s workers are finally matching the rate of hourly output last achieved in 2017. The huge spike in productivity came in the final quarter of 2016, months after we voted to quit the stagnant European Union. The news is part of a wider uptick in the British economy as surging exports have boosted the nation. Services PMI rose in the month of March to 55, up from 53.3 the month prior and indicating accelerating growth. No wonder tech entrepreneurs are so keen on Brexit Britain with the number of tech firms starting up in Britain more than doubling after we voted Leave in historic numbers last year.
A lot of the boom could come from the more competitive value of sterling, with ONS data showing Britain’s current account deficit narrowing – a long awaited transformation for the economy. But the boom isn’t limited to overseas sales with British fashion giant ASOS reporting a huge 18% increase in domestic sales alongside the 54% explosion in foreign sales over the last six months.
Investors are massively optimistic about the UK too with a new survey from Market Financial Solutions showing that only 9% of Brits with £10,000 in investable assets were worried about the negative impacts of leaving the European Union. But 39% saw the upside, seeing Brexit as an opportunity for short-term wins. Finance chiefs are buoyant too, with a new survey from Deloitte showing their optimism at an 18 month high. 31 percent of CFOs are more optimistic now than three months ago, highlighting the rising tide of informed opinion backing our exit from the EU.
And why wouldn’t they? The lies of the Project Fear campaign are being exposed every day. Just this week JP Morgan had to perform an embarrassing U-turn on their toothless threat to pull staff out of London with Jamie Dimon admitting that “this does not entail moving many people in the next two years”. No shock, since no other European financial centre boasts the upside of London.
Another major Project Fear fib was busted too when a new report from the Cebr revealed that house prices are set to rise by a whopping 4.4% this year as Britain exits the failing European Union – exposing the lie behind George Osborne’s cynical threat to homeowners across the country.
And finally it has been announced that Cadbury will be returning production of their iconic Dairy Milk bar to the UK having previously moved jobs overseas to Poland in a controversial move. It follows a major £75m investment in West Midlands plants, restoring a major British confectioner to our home soil.
31 March 2017
The markets reacted well to the official start of Brexit as the UK enjoyed another strong week in economic news.
The currency markets reacted well to Article 50 notice with the pound soaring against the dollar and the euro and remaining on track for its first quarterly gain against the dollar since 2015; Siemens and James Dyson reiterated their commitments to Brexit Britain as Qatar looked to huge investment in the country and European farmers looked worried at the threat of British global trade; Theresa May was warned to pull out of the European Customs Union while Nicola Sturgeon’s Europhile hopes were left in tatters by threats of a huge membership bill; and British business had cause for celebration as good news poured in for aerospace, textiles, and financial services.
Despite the pessimism of bitter Remain campaigners, sterling performed well on the day that Article 50 of the Lisbon Treaty was triggered and Britain officially began its long-awaited exit from the failing European Union. The currency rose against both the dollar and the euro, rallying to a four-week high against the latter. The moves could see sterling win its first quarterly increase against the dollar since 2015, with the pound rising 1% on the dollar as US President Donald Trump struggles to wrangle support for his fiscal programme in the United States Congress. The value of sterling fell in the immediate aftermath of the referendum, making British produce more competitive overseas and boosting manufacturing in the UK in the process. But many will welcome the recent uptick in the currency, which will prevent added costs from entering the supply chain.
Brexit Britain also got big boosts this week from a number of sources as British innovator James Dyson reiterated his support for the country, saying that he was “enormously optimistic” about the country’s chances for a global trading future. He highlighted that the fastest growth is outside of the stagnant European Union and that Britain should set its sights higher than Europe. “Europe’s only 15% of the global market and the really fast-expanding markets are in the Far East.”
It seems that Britain has won interest from the Near East too as Qatar looks to invest a massive £5bn in an independent United Kingdom. The Prime Minister of the country said that “over the next three to five years Qatar will invest £5bn in the UK economy through various investment funds and relevant parties in Qatar.”
German engineering giant Siemens joined the chorus too, saying that “London and the UK remains an important market for Siemens and is a good place to do business”, adding that “London remains a leading centre for innovation and technology and we see many opportunities for collaboration on talent, digitalisation and investment in the years ahead.” Despite Remoaners talking down the country, there was always more to Britain than membership of the stale EU.
More voices have chimed into our future economic relationship with the EU too with the major think tank Open Europe calling for Theresa May to abandon the protectionist European Customs Union and avoid the half-in, half-out relationship some have advocated. Customs Union membership with squander our chance to seize control of British trade policy. Nicola Sturgon got a dose of reality too this month when the cost of Scottish membership of the EU was exposed. Official Holyrood figures put the sum at an eye-watering £1bn a year once you exclude the British rebate – a huge figure for a country that already has serious budgetary problems.
European farmers are spooked by suggestions that Britain could quit the Customs Union too, freeing up the country to cut the cost of food for British consumers by cutting outrageous food tariffs. The asymmetry was highlighted by Harry Smit of Rabobank, who pointed to the fact that the EU has “an interest in maintaining access to the British market, while the UK will no longer only have to look to the EU for its food needs”.
Sectors across the British economy got good news this week too. Projections for the aerospace sector suggested it would hit new highs this year following a great 2016, with 1,528 aircraft deliveries expected this year. The chief executive of the sector’s major trade body, ADS, there is “continued success for the UK aerospace industry and good prospects for the rest on 2017. The industry is looking to build on 2016’s record year for deliveries, as all major aircraft companies look to increase their production rates”.
Financial services also got a boost as the Z/Yen Global Financial Centres Index ranked London the world’s top financial centre, beating out New York again in the wake of Donald Trump’s election as US President. Textiles has done well too, with the Lancashire textile industry looking forward to a bright future as a major provider of work uniforms has restored production to Britain. Alsico has abandoned Italian fabrics due to fluctuating currency values, moving production for their 75,000 weekly uniforms to Bolton. It’s just one of many stories that together have seen British factories more optimistic than at any time in more than two decades. A new CBI survey shows exports growing more rapidly than at any time in the last three years as manufacturers continue to enjoy a Brexit surge. The big benefit has especially aided mid-size firms, who have seen overseas turnover increase by 7% in 2016, making £127bn.