Stronger than expected growth

The growth figures for the third quarter of the year have just been released, and it’s better than we thought: 0.8 percent, twice the 0.4 percent figure that was expected, but down on the 1.2 percent achieved in the spring. In any case, it should play well for Osborne & Co. We’ve just witnessed the fastest third-quarter expansion of the economy for a decade. Double speed, rather than double dip.

Really, though, these figures throw up more questions than conclusions. By far the most important is: where next? The coalition would have been untroubled by an even larger reduction in growth now (caused by weak consumer spending, among other variables), so long as we get stronger growth in future. If that comes, then the economic argument over cuts and the pace of cuts will basically have been won. But if today’s figure is merely a prelude to rising concern about the cost of living – as set out in a Spectator cover piece by Allister Heath this week – then George Osborne will have considerably more to worry about.

As for Labour, they won’t squeeze as much unrestrained, partisan enjoyment out of today as planned. So their attention may, instead, turn inwards. Even by their own account – a memo leaked to this morning’s Times (£) – their economic message lacks definition and form. If growth comes hard in the next few months and years, then it will lack any credibility too.