UK Q1 GDP Grows 0.5%, In Line With Expectations

Tyler Durden's picture

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tallen's picture

RPI at 5.5%, CPI at 4%. GDP growth at 0.5%. At this rate England's gonna be third world in a few years.

Cassandra Syndrome's picture

Yep, the cheeky gits use a GDP deflator of only around 1.5%. Cheating or what?

4realmoney's picture

The "Royal" Wedding is England's Black Swan Song

Yen Cross's picture

I like long GBP.

Dick Darlington's picture

Remove the 10%+ deficit and let's see how the "growth" looks like...

slewie the pi-rat's picture

it snowed, remember? 

then, it melted, remember?

and, there's a wedding, remember?

Bow Tie's picture

we've got such a high official (and even higher real) inflation rate to begin with, a nominal 0.5% is really nothing to cheer about.

relative GBP strength is going to collapse as the housing market crumbles and more QE is needed to offset any pain from future rate rises.

and we didn't even get to the current debt and deficit levels.

FunkyOldGeezer's picture

We're muddling through, maybe better than who knows?

The ENTIRE West will be third world in a few years.

A Man without Qualities's picture

and equities go back to their daily melt-up....

Josephine29's picture

However people like Goldman Sachs try to spin the numbers the fact is that UK economic growth is at best flat and looks like it is going nowhere. The Notayesmanseconomics blog is very critical of Bank of England policy.

This brings me back to a theme of mine for the UK which is stagflation. How do we define it? No growth since the third quarter of 2010 and an official inflation rate which at 4% is twice its target seems to do the job. The first part of the sentence gives us the stag and the second the flation.

If we put to one side my view that the UK needs a change of economic policy and look at the consensus view of our Monetary Policy Committee it is apparent that they are in danger of not only failing on my terms but also failing on their own. In truth we can see that they have really targeted economic growth in the UK and the result of this has been no growth at all over the past six months


So their expansionary policy has provided little or no growth but plenty of inflation,exactly what do they think that their job is?

Bow Tie's picture

I follow the Notayesmanseconomics blogger, Shaun Richards, and he is certainly one of the best straight-headed analysts of UK monetary policy out there.

Lord Peter Pipsqueak's picture

So the 30% devaluation of sterling by the Bank of England was justified at the time by saying it would help the country export its wqay out of its mess.Only problem is the imports the manufacturers need have just gone up 30% thereby removing most of the advantage in one fell swoop.Add to this the boss of UK Vauxhall motors recently complaining he cannot source UK made parts for their cars(having to import them at £ +30%)and you can see the Bank of England is merely trying to inflate its way out of this mess and at the same time saying it is targeting inflation,it has, like the Fed, zero credibility.It is more likely they are targeting inflation at 10% but telling us they are targeting 2%.

Andrew Sentence the outgoing member of the Bank Of England rate setting commitee has pointed out that since 2006 inflation has been above its 2% target for 46 months,and above 3% for 28 months: 

Expect further sterling weakness until the real UK economy-the housing market- recovers.Then the average Brit can resume discussing how much richer they are down the pub after their house has just gone up in price,and go to sleep thinking how clever and lucky they are to able to make money without having to work for it.

Meanwhile the other half of the UK economy -the chavs,the single mothers and the economic migrants can also sleep soundly in the knowledge they will never have to work for the cheque that arrives each week,and when they require an upgrade to their flatscreen TV or the latest mobile phone, hey just knock another kid out,the state will then pay you even more money to do nothing.What a truly great country it is.

Broomer's picture

Strange, I can't embed images...


Lord Peter Pipsqueak's picture

We're No1 at what exactly?

Broomer's picture

Please notice that the image says "WERE #1", not "WE'RE #1".

spacecadet's picture

 and in the case of Japan, outright collapsing, supposed to lead to a 3.5% global GDP growth in 2011.

Simple. 3.5% inflation will give them the desired result.