Interesting little economic release from the UK that may be a big tell on the economy.
U.K. sales dropped 0.5 per cent from July, when they rose 0.8 per cent, the Office for National Statistics said today in London. Economists predicted a 0.3 per cent increase, according to the median of 23 forecasts in a Bloomberg News survey. On the year, sales rose 0.4 per cent, the smallest increase since April.
The question is: Is UK austerity to blame for sapping demand across the economy? And if so, will that undermine the country’s ability to get its budget in balance?
Obviously it’s just one datapoint, though when combined with the sagging Greek and Irish economies, it’s another datapoint that suggests problems in the world’s austere nations.
This is one of our big themes to watch for the year — the failure of spending cuts to accomplish anything (in the short and medium terms) for the economy.
The news whacked the pound this morning.
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