UK GDP, 2nd Quarter 2012: The Office for National Statistics (ONS) has released its second estimate of the UK economy and has revised the trend upwards to show a reduction of -0.5% (from -0.7%) compared to the 1st quarter; this makes the UK economy -0.5% smaller than it was a year ago. The revision was equally split between the production and construction sectors of the economy, with both of these contracting by less than had been estimated in the preliminary figures which were released a month ago. This estimation process was made more difficult by the impact of the bank holidays in June, as the preliminary estimate had very little data about June on which to draw.
The weakest part of the economy remains the construction sector which showed a quarter-on-quarter fall of -3.9% and is -8.6% down on a year earlier; the equivalent figures for manufacturing (which accounts for about two-thirds of the production sector) show a reduction of -0.9% and -2.8% respectively, while the service sector fell by -0.1% on the previous quarter, but was +0.7% larger than a year ago.
More details are available in the ONS Statistical Bulletin which can be downloaded from their web-site at www.ons.gov.uk or requested from MTA
UK Business Investment, 2nd Quarter 2012: Provisional data from the ONS shows that spending on Other Capital Equipment (total investment minus new building works and vehicles) by the manufacturing sector was +5.1% higher than in the 1st period of the year and +9.8% higher than in the 2nd quarter of 2011. Total investment spending by the Engineering and Vehicles sector was up by +13.3% on the previous quarter and +18.5% higher than a year earlier. Again, more details are available in the ONS Statistical Bulletin which can be downloaded from their web-site at www.ons.gov.uk or requested from MTA
CBI Industrial Trends Survey, August 2012: There is not such good news from the latest CBI survey which reported that total order books fell below their long-run average in August, the first time this has happened in 2012; although export orders also fell, mainly in the consumer goods sector, they did at least remain just above the long-run average level overall. Manufacturers responding to the survey expect output to be flat over the coming 3 months, following expectations of modest growth in the two previous surveys. You can get the CBI’s Press Release on this survey from their web-site at www.cbi.org.uk; their main story at the moment is that they have cut their forecast for the UK economy to show a fall of -0.3% for the year, compared to an expectation of growth of +0.6% in their May report.
US Machine Tool Foreign Trade, 1st half of 2012: A brief summary of the trade data from AMT shows that US machine tool exports were -3.3% lower than in the first half of 2011, while imports increased by +52.6% in the same period; this nearly tripled the size of the US trade deficit for machine tools.