Economy

The latest labour market update – published by the Office for National Statistics this morning – looks a lot like last month’s update: that’s to say, a mixed bag of news. Unemployment rose again, up 0.1 per cent between October to December, to 3.7 per cent. But this quarterly rise was once again off-set by a fall in economic inactivity: down 0.3 percentage points, largely thanks to young workers entering (or re-entering) the workforce.  Overall, it’s a trade-off worth making: the official unemployment figure has failed for some time to reflect the true number of people out of work, as over two million people of working age are thought to be

They never give up, those Remainers. Like the Japanese soldier found on a Pacific island still fighting the second world war – in 1974, every other day there is another loose shot from the undergrowth. After last week’s Ditchley Park gathering involving Lord Mandelson, David Lammy and others, comes an interview in the Overshoot with Monetary Policy Committee (MPC) member Jonathan Haskel. In it, Haskel makes the claim that Brexit is costing each British household £1,000 a year through lost trade and investment. The beauty of modelling is that you can get it to tell you pretty much anything you want it to Let’s start with the assertion that this is a

Treasury select committee meetings are not usually the stuff of great television. But this morning, it was. The Bank of England’s governor Andrew Bailey was up as a witness to give evidence on recent Monetary Policy reports. And the committee’s new chair, Harriett Baldwin, came ready to highlight where (many) mistakes had been made. Starting with where we are today – inflation still over 10 per cent, five times the Bank’s target – Bailey was forced to sit and listen to his own record over the past eighteen months. Beginning in May 2021 and moving into that autumn, Baldwin quoted his own warnings about ‘very hot areas of prices’ back

Fifty years ago I was hitchhiking down the Eastern Seaboard towards Miami overnight. It was midwinter, icy and way, way below zero. Through miscalculation, I had ended up being dropped near the Cross-Bronx Expressway. I walked up a ramp to the elevated carriageway and began trying to thumb another lift. Utterly stupid: no car was likely to stop. But I was tired, and getting desperate. We’re in slow, apparently relentless but quite comfortable decline; and no chasm yawns ahead, or not yet After about an hour the intense cold was biting deep into the bone. Though I had gloves, I lost feeling in my hands. Still I persisted, exhausted but

It was self-indulgent, whinging. Dull in places while completely batty in others. All the usual insults will be hurled at former prime minister Liz Truss for her essay defending her short time in Downing Street, published today. Perhaps it would be better for her to retire gracefully from public life and let some ambitious young revisionist historian in the 2060s make the case that she was treated unfairly. Except she still has one key card to play. Events are gradually showing that she was right along: Trussonomics, or whatever it will be called next, is gradually winning the intellectual argument. Her argument has something else going for it: a ring

You’ve got to hand it to the trade unions: they’ve done a fine job rallying the public behind industrial action that has caused widespread disruption and inconvenience. Despite train cancellations, school closures and medical appointment delays, nearly two-thirds of the British back the nurses’ walkout and close to half back the teachers’ strike. Even sizeable minorities support the ongoing train strikes, according to recent polling.  The argument from the unions – that their hardworking members deserve a hefty pay rise (in order to ‘improve service’) – has captured the public imagination. But how many of those who complete YouGov or Opinium surveys stop to consider the huge discrepancy between public and private

Markets expected another interest rate rise today of 50 basis points. That’s exactly what they got. This afternoon the Bank of England has announced its tenth rate rise in a row, from 3.5 per cent to 4 per cent.  The Monetary Policy Committee (MPC) voted 7-2 to raise rates to 4 per cent; two members voted to hold the bank rate at 3.5 per cent, exposing the dovish leaning that has been a feature of the MPC during the pandemic years. This created a credibility issue for the Bank, as it failed to act on inflation for so long, putting itself in a position of having to play catch-up with

Among Ukrainians, there is little debate about how the war will end. The overwhelming consensus is that it cannot conclude until Russia has been fully repelled, and Ukraine’s borders are returned to the 1991 frontier when independence was declared after the Soviet Union collapsed. This means removing Russian troops from Crimea and the self-proclaimed republics of Luhansk and Donetsk in the Donbas region. Of course this is not an easy mission. But for Ukrainians, the alternative is unthinkable. The mass graves uncovered in Bucha have shown us what Russian occupation means. We have also seen, in the broken promises of the Minsk agreements, what any truce with Vladimir Putin is

Just what is a UK government supposed to do to keep the IMF happy? This morning it has issued a bulletin predicting that the UK will be the only major economy to shrink in 2023 – by 0.6 per cent – and blaming it on ‘tighter fiscal and monetary policies’. This represents an even-bleaker outlook than the IMF foresaw in October, when it pencilled in growth of just 0.3 per cent. Yet this is the same IMF which last September condemned Kwasi Kwarteng’s mini-Budget for slashing taxes, saying 'given elevated inflation pressure in many countries, including the UK, we do not recommend large and untargeted fiscal packages at this juncture, as