Dollar jumps as strong US retail sales ease recession fears – as it happened
US retail sales grew by 1% in July, much stronger than the 0.3% expected; UK GDP grew by by 0.6% in Q2 2024
Pre-election uncertainty, and industrial action, may both have weighed on the economy in June.
The Office for National Statistics says anecdotal evidence from businesses suggests some clients were reluctant to place orders until they knew who had won the election.
Comments provided for June 2024 suggested some industries may have been affected by the general election held on 4 July 2024. In a range of industries across the economy, businesses stated that customers were delaying placing orders until the outcome of the election was known. These comments covered all of manufacturing, construction, and services.
While perhaps not as frequently mentioned as in recent months, industrial action in certain industries was also cited as a possible reason for reduced output.
This was stated as a reason for reduced output in human health with the junior doctors strikes towards the end of June, and in TV and film production where the Screen Actors Guild strikes in America in 2023 are still affecting UK production schedules.
The second quarter seems like a long time ago, but the GDP data confirms that the UK economy is in good health. The Bank of England is in the nice position, unlike other central banks, of having a level of surety in the data it is seeing, when setting policy.
With inflation playing ball as well, the path to lower interest rates looks to be set, the timing of the cuts is now the focus."
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