Service sector growth slows as Osborne's cuts bite

Public sector cuts limit services sector to slowest growth in a year, services PMI survey shows
Banks in West London, Britain - 04 Nov 2008
The service sector – which ranges from banks to hotels – provided a major boost to GDP in the second quarter. Photograph: Chris Ratcliffe/Rex Features
The government's wave of public sector cuts knocked growth in the services sector to its lowest in a year last month, according to a closely watched survey today that raises more concerns about the pace of the economic recovery.

With the bulk of cuts still to come, businesses are already reporting a blow from cancelled public sector contracts. Services companies, which range from hotels to banks, saw activity rise at the slowest pace since they emerged from recession a year ago, according to the Markit/CIPS UK services purchasing managers' index (PMI).

As demand for new work stalled amid uncertainty over the economic and spending outlook, the headline index dropped to 53.1 in July – the lowest since June 2009. It was still above the 50-mark, dividing expansion from contraction, but was below forecasts for it to hold at this June's level of 54.4 in a Reuters poll of economists. Experts said the slowdown in the economy's biggest sector bolstered expectations that overall growth will slow in the second half after a surprise burst of activity between April and June.

"The service sector provided a major boost to GDP in the second quarter, but the rate of expansion has slowed sharply in recent months, suggesting a far weaker contribution to economic growth in the second half of the year," said Paul Smith, senior economist at survey compiler Markit.

New business also grew at the slowest pace for 13 months and there was worrying news on employment.

"Disappointingly, the survey also shows that service providers are cutting payroll numbers, suggesting that private sector employers are unlikely to compensate for public sector staffing cutbacks and therefore implying that unemployment may begin to rise again," said Smith.
"Behind the weaker growth profile for the service sector is a failure of confidence to rebound from the record fall seen in the aftermath of the emergency budget. Expectations about prospects for the coming year appear to have down-shifted in response to the austerity measures announced in June, with reports of cancelled contracts and reduced enquiries adding to the sense that tough times lie ahead."

The slowdown in services sector growth follows similar survey readings this week on both manufacturing and construction and bolsters economists' views that a jump to 1.1% growth in second-quarter GDP was a blip and set to be followed by subdued growth and maybe even a double-dip recession as cuts bite.

The pound fell against the dollar after the survey raised traders' concerns over the fragile nature of the UK's economic recovery and led them to raise bets that interest rates will remain at their record low of 0.5% for many months to come.

"The surveys suggest that when it comes to third-quarter GDP, the economy is likely to struggle to expand by even half the 1.1% quarterly pace that was recorded during the second quarter," said Alan Clarke, economist at BNP Paribas.

David Noble, chief executive at survey co-authors the Chartered Institute of Purchasing and Supply said it was worrying to see the measures in George Osborne's austerity budget were being felt so soon.

"This month's services PMI will undoubtedly raise questions about whether the economic recovery is running out of steam. To see government spending cuts impact the sector so quickly is concerning given the bulk of cuts are still yet to come. The big question is whether the private sector can plug the big gaps left by the public purse," he said.

"The fall in employment is particularly disappointing and shows how quickly businesses will respond to worsening economic conditions – let's hope this isn't a trend we'll see continue."

Double dip recession fears as service sector growth stalls

Stalled growth blamed on cancelled government contracts amid signs consumer spending is cooling off
thinking allowed bank of england zoe williams
The Bank of England will announce its latest decision on interest rates on Thursday. Photograph: Lefteris Pitarakis/AP
The threat of a double-dip recession intensified today after it emerged that Britain's powerhouse services sector saw its growth stall last month, jeopardising hopes of a sustained recovery.

As the Bank of England prepared to announce its latest decision on interest rates tomorrow, a survey of the sector that makes up the bulk of Britain's economic output showed that its growth slipped to its slowest since it emerged from recession a year ago.

Many of the companies surveyed said cancelled public-sector contracts were beginning to hurt their businesses, forcing them to cut jobs and dealing a blow to chancellor George Osborne's hopes of reviving the private sector by reducing public spending.

The gloom was compounded by warnings from leading retailers that consumer spending is cooling off after a strong start to the year amid uncertainty about the economic outlook.
Labour today continued to challenge the wisdom of cutting the deficit so hard so soon, in contrast with its own plans. Ed Balls, the shadow education secretary, said: "These warnings show why it is so risky for the government to be cutting public sector contracts now when the recovery in Britain is so fragile and people around the world are worried about a double-dip recession. David Cameron is misguided and wrong to say the most urgent priority for Britain is to slash the deficit. The most urgent priority should be to secure Britain's economic recovery by boosting jobs and growth."

The reports will be a powerful weapon for doves on the Bank's monetary policy committee, who will argue that raising interest rates from their current historic low – which more hawkish members believe is necessary to combat inflation – will risk strangling the recovery in the second half of the year.

The bank's governor, Mervyn King, met David Cameron today. He was likely to have emphasised to the prime minister his publicly expressed belief that rates will have to stay low because the recovery is still fragile. They also discussed the need to encourage more bank lending to help the recovery.

But casting a shadow over their meeting were the figures showing that growth in the service sector, which spans businesses from insurance to hotels and restaurants, fell more than expected to a 13-month low in July, according to the Markit/CIPS UK services purchasing managers' index. "This has hugely increased the risks of a double-dip recession, perhaps even by the end of the year," said Chris Williamson, chief economist at survey compiler Markit.

The companies surveyed – which account for about 40% of the economy – were only slightly more optimistic than in June, when Osborne's austerity budget hammered their hopes of a swift recovery. Reflecting dwindling confidence and a slowdown in order book growth, they cut staff, casting further doubt over the private sector's ability to provide jobs as government departments are shrunk.

"This survey is representative of the type of trends we are likely to see over the next couple of years – a long and slow grind towards recovery, with public sector cutbacks bearing down on demand," warned Andrew Goodwin, senior economic adviser to the Ernst & Young Item Club thinktank. "Given the impending squeeze on the public sector, the onus is on the private sector to create new jobs. The service sector has been central to job creation over the past decade, so these results highlight the risk of further increases in unemployment as the public-sector cuts begin to bite."

The darkening picture in the services sector follows similar reports this week on both manufacturing and construction and sent the pound lower as traders fretted over the fragile nature of the UK's economic recovery. Accompanying complaints from retailers such as high street chains Next and Carpetright that consumer spending is flagging bolstered economists' views that a surprise jump in second-quarter GDP was probably a blip and likely to be followed by subdued growth, especially once the government's autumn spending review spells out the full scale of the fiscal squeeze.

Ministers remain confident that the public is still with them on the need to cut the deficit and believe growth will continue through until 2011. Cameron will tomorrow reiterate the necessity of tackling what he regards as Britain's uniquely high deficit at another "PM direct" session.
Shadow ministers will not predict a double dip, but instead highlight the risk of it happening. Most forecast a long, slow recovery, such as in Japan, in which joblessness remains high.
Business groups seized on the news of mounting economic headwinds to urge the Bank to keep interest rates steady today and for many more months.

"Given the risks of an economic setback it is far too early to consider raising rates," said David Kern, chief economist at the British Chambers of Commerce. "Any serious consideration of raising interest rates should be off the table until the second quarter of 2011 at the earliest."

Even though inflation is above the Bank's government-set target, City economists unanimously expect rates to be held tomorrow. King has already flagged the balancing act policymakers face between price pressures and fragile growth at home and abroad, hinting rates will remain low for the rest of the year. He will have a chance to outline the Bank's latest thinking in next week's quarterly inflation report.

Sterling ends week's rally on fears that budget cuts could dent economic recovery

Sterling finally ended this week's rally against the US dollar, as investors' optimism about the strength of Britain's economy slightly waned.

The services industry grew at the slowest pace over the past 13 months in July, a sign that economic recovery may not be as strong as expected. The Markit/CIPS services PMI index fell to a lower-than-expected 53.1 in July, down from 54.4 in June, the lowest level since June 2009 and below analysts forecasts.

"The market is expecting strong headwinds in the second half for the UK as the government embarks on its schedule of fiscal reform -this data suggests that the impact may be a little heavier than expected," said Jane Foley, research director at Forex.com.

The pound traded 0.2% lower at $1.592 at 11.30am. The recent rally had been pushed by strong economic data, including second quarter economic growth and better than expected manufacturing indicators. Strong bank results from HSBC and the expected return to profits from Lloyds Banking Group and the Royal Bank of Scotland also added optimism about the health of the economy.

Draconian budgetary cuts pleased bond investors, who care more about inflation and getting their money back than about unemployment figures, lifting demand for UK government bonds and, therefore, the value of the currency.
"The cost of this toughness could be relatively weaker UK growth ahead and that could end this sterling rally against the dollar," said Steven Barrow, head of G10 strategy at Standard Chartered Bank.


2010/08/06 09:58










http://www.chinareviewnews.com   2010-08-06 08:42:04

中評社香港8月6日電/英國《金融時報》8月6日載文《第二大經濟體≠第二大經濟強國》,文章說,日前,中國人民銀 行副行長易綱將中國稱為“世界第二大經濟體”。這表明從他掌握的上半年的經濟數據來看,中國的GDP已經超過了日本。當然由於媒體報道的不詳細,尚難揣測 道易綱用的是平價購買力還是匯率GDP指標。如果按照平價購買力來計算,中國很多年前已經超越了日本,成為了世界第二。


伴隨著中國國家統計局在7月初初步核實的2009年GDP數據,中國2009年GDP增長速度為9.1%。這個數據比今年年初發布的8.7% 提高了0.4個百分點。也就意味著在2009年——以去年全年人民幣兌美元的匯率平均值計算,更改後的中國GDP總量折算成美元大約為4.985萬億美 元。而根據日本內閣府公布的最新數據顯示,2009年日本GDP總量折合成美元總計5.068萬億美元。據此,兩國的GDP差距進一步縮小,僅為800億 美元了。

這個差距在今年上半年看來已經輕鬆的被跨越。考慮到今年上半年,中國經濟同比增速高達11.1%,國際貨幣基金組織預測中國經濟2010年全 年能夠實現10.5%的增長率。相比之下,日本今年經濟增長率可能僅為2.4%。這意味著,中國從今年第二季度開始就已經超過日本成為全球第二大經濟體。 到2010年全年結束,只要日元沒有特別意外的大幅升值,中國匯率GDP超越日本,排名世界第二已成定局。

儘 管中國的GDP在世界即將排名第二,在人均GDP這個更具價值的指標來看,中國還是沒有多少顔面的。IMF2010年發布的數據顯示,中國2009年人均 GDP達到了3566美元,排名世界第99位。而日本排名世界第16名,人均GDP 為39573美元,是中國的10倍以上。即使按照世界人均GDP8000美元來衡量,中國還只有世界平均水平的45%。



二是存在嚴重的行業差距。中國行業收入差距最高與最低的比值在逐年拉大,今年一季度公布的數據顯示,最高的證券業是中國平均的5.9倍,行業 收入最高與最低的比例擴大到了11:1。而這種差距約1/3是壟斷因素造成的,雖然壟斷行業的從業人員占的比重很小,但其拉高了中國的平均工資。

三是,中國貧富差距進一步拉大。據最新統計,中國的基尼系數已從改革開放初的0.28上升到2007年的0.48,近兩年不斷上升,已超過了 0.5。國際上通常認為,一旦基尼系數超過0.4,表明財富已過度集中,社會處於可能動亂的“危險”狀態。這一數據意味著中國已經成為了世界上貧富差距最 大的國家之一。財政部最近有一個關於財產性收入的統計數字顯示,10%的富裕家庭占城市居民全部財產的45%,而最低收入10%的家庭其財產總額占全部居 民財產的1.4%。由於財富被少部分人所擁有,大部分中國人的人均GDP排名可能還在世界150名以後。 
四是,存在嚴重的區域發展不平衡。1999年,東部地區人均GDP為10732元人民幣,西部地區為4302元人民幣;到2005年,東部地區人均GDP 為22200元,西部地區為8970元。6年間,東西部人均GDP差距由6430元擴大到13230元,增加了1倍多。而中西部地區集中了中國更多的人 口。




2010/08/05 13:51



VocaLink首席執行官Marion King稱,從09年10月以來,物價增幅一直超過收入的增長,這令家庭擔憂其預算將收緊。盡管CPI同比增幅和稅後淨薪指數的缺口在7月收窄,但仍有2.4個百分點之多。




國際/英央行推公債計畫 提振經濟

 http://www.cdnews.com.tw 2010-08-05 22:31:26



擁有9月成員的貨幣政策委員會以央行總裁金恩(Mervyn King)為首,將收購公債目標訂在2000億英鎊(3180億美元)不變,與彭博調查的34位經濟師預測一致。英國央行將基準利率維持在0.5%不變。

委員會成員上個月針對政策走向出現意見分歧,委員桑坦斯(Andrew Sentance)表示,應調高利率遏制通膨,但邁爾斯(David Miles)則堅持央行應為收購更多公債作準備。雖然調查顯示服務業、製造業和營建業活動減弱,但第二季經濟成長速度仍創下4年來最快。

倫敦天達證券(Investec Securities)經濟師裴基(David Page)接受電訪時說:「在市場對復甦速度持續憂心下,這個決策較之前更具有爭議性。我們認為未來將不會出現進一步的量化寬鬆政策,但部份委員可能會支持此政策。」


英國經濟恐 二次探底

鉅亨網新聞中心 (來源:財匯資訊,摘自:國際金融報) 2010-08-06 08:43:04

英國《衛報》當地時間8月4日報導稱,目前,英國經濟“衰運不減”,二次探底的可能性越來越大。根據最新公布的一份報告顯示,英國的強勢行業——包括保險業、酒店行業在內的服務業在過去一個月內,增速極為緩慢,為英國經濟的持續復甦蒙上陰影。8 月5日,英國央行維持利率和量化寬松規模不變,并預計英國央行本月和今年秋季不會加息。


服務業的低增長歸因於政府為削減支出,取消了公共領域的合約,迫使企業不得不裁減員工,節省開支。此前,英國財政大臣奧斯本還指望通過削減公共開支來實現私有行業的復甦,而這樣的結果無疑是最大的諷刺。 與此同時,英國的主要零售商警告說,英國民眾在消費支出方面正逐漸降溫。這對日益渺茫且充滿不確定性的英國經濟前景來說必然是雪上加霜。


www.stockstar.com 2010-8-6 8:53:04 匯通網


  “8月的通脹報告將標誌英國宏觀經濟政策的分水嶺。”英國央行(BOE)發佈今年第三份通脹報告前夕,倫敦的貨幣政策諮詢公司法騰諮詢(Fathom Consulting)預言。


  但與其說是預言,不如說是敦促。在他們看來,自1997年獲得貨幣政策獨立決策權以來,英國央行為了突出其獨立性,一直在對政府的財政政策“故作漠不關心狀”。結果是,英國央行對經濟形勢的判斷不能反映現實,直接影響了貨幣政策的有效性。因此,法騰諮詢認為,英國央行是時候“走出圍欄”(get off the fence),直言其對財政政策的看法,並解釋清楚他們的貨幣決策將如何影響財政政策。



不過,法騰諮詢的分析師們認為,現在市場上的通脹預期還比較穩定,所以還不是擔心通脹的時候。當務之急是避免“二次探底”。為此,英國央行不僅在明年前都不能升息,還要做好準備再來一次“數量型寬鬆”。只是,為了防止拖累英鎊幣值,英國央行“千萬、千萬不能再買英國國債了”,法騰諮詢董事賈拜(Danay Gabay)說。英國央行去年至今進行的總額2000億英鎊的數量型寬鬆操作中,幾乎全部用於購買英國國債。

  事實上,英國央行對通脹的忍耐度已經顯得有些偏高。即使是經歷了經濟衰退,英國2008年至今的平均CPI通脹率還是達到了3%——高出2%的目標水準。5月的貨幣政策會議上,自金融危機以來首次有委員提出“升息”:委員沈談思(Andrew Sentence)提醒大家,過去兩年的記錄或已說明,英國央行的貨幣政策事實上過於寬鬆。但九人的貨幣政策委員會中只有他這麼想。



  “未來十年內,我們會看到(英國央行)非常保守的管理方式。”前貨幣委員會委員古德哈特(Charles Goodhart)說。
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