Analysis from Dr John Ashcroft on the economic impact of Covid-19
In Southern California, off the twin ports of Los Angeles and Long Beach, 62 container ships lie at anchor, awaiting an unloading berth. The floating queue, a phenomenon unknown before the pandemic, has doubled in size since August. The precious cargo includes toys, electronics, furniture and many other goods awaited in distribution depots and in store. A further 29 ships are adrift twenty miles offshore.
Analysis from Dr John Ashcroft on the economic impact of Covid-19
UK car factories turned out 69,097 units in June, according to the Society of Motor Manufacturers and Traders (SMMT). While this was a rise compared with the Covid-depressed June 2020, however, it still represents the worst June total since 1953 as the global chip shortage, caused by the pandemic, and staff shortages caused by the “pingdemic”, make an impact. By the end of July, almost 700,000 workers have received isolation alerts from the NHS “Stay at Home” App.
Analysis from Dr John Ashcroft on the economic impact of Covid-19
Retail sales jumped by almost 10% in April. Masked shoppers returned to the high street. Sales were up 40% compared to April last year. Sales were up by 12% compared to pre-pandemic levels in the months of 2019. Clothing stores were major beneficiaries. Sales volumes increased by 70% compared to the prior month. Household goods sales jumped 10%. Furniture sales were up by 30%. Sales of cosmetics were up by 25%.
Analysis from Dr John Ashcroft on the economic impact of Covid-19
The IMF now sees a brighter outlook for the world economy. The Bank of England is feeling more optimistic about the UK. The Office For Budget Responsibility forecasts real growth of 11% over the next two years. Forecasts for the UK will be revised up. In nominal terms the UK could grow by over 20% over the next three years, underpinning growth for jobs and business in the medium term.
Analysis from Dr John Ashcroft on the economic impact of Covid-19
Andy Haldane, Chief Economist at the Bank of England, expects Britain’s economy to recover ‘at a rate of knots’, from the beginning of the second quarter this year. It should not be too difficult. The comparative figures for last year, are not much to beat. The economy collapsed by just over 20% in Q2 last year. The recovery in the economy will appear to be pretty dramatic,
Analysis from Dr John Ashcroft on the economic impact of Covid-19
Our views on recovery are unchanged. We expect output to be down, by around 10% in the third quarter, and down by 5% in the final quarter of the year. Output for the year as a whole, will be down by 10%. Unemployment is set to rise to between 2.5 and 3.0 million, a rate of 7.5% and 8.5%, without any additional extension to the job support scheme.
Analysis from Dr John Ashcroft on the global social and economic impact of Covid-19
What shape will the recovery be in the UK..? It’s a V, it’s always a V…
We are at the stage in the economic cycle when questions are raised about the shape of the recovery. Pick a letter from the alphabet and make the case. Jerome Powell, Chairman of the US Federal Reserve, suggests the American recovery will follow a ‘Slow V’.
Analysis from Dr John Ashcroft on the global social and economic impact of Covid-19
As the UK case load peaks…
In Italy, the epidemic is slowing down. Following four weeks of shutdown. Italian officials say it will take until Easter to reduce infections sufficiently, to begin a relaxation of quarantine measures. Sections of industry will be urged to return to work, under stringent safety conditions. Italian restaurants and bars are expected to begin to re-open at some stage later in May.
John Ashcroft, Economist and author of The Saturday Economist, weighs up the evidence.
Britain faces a ‘devastating recession’, a plunging pound and soaring prices if a ‘No deal Brexit’ takes place, according to a recent analysis from ratings agency Moody’s.
Here’s how that works out… In the event of no agreement to an orderly exit from the EU, the UK would face a considerable crisis of confidence leading to a fall in output.
Is this likely?
