As I listened to the news on television this morning, I was reminded about George Bernard Shaw's view on economists...
If all the economists were laid end to end, they would not reach a conclusion.
If you hadn't heard it enough, let me remind you that its tough out there folks. Looking around for a succinct view, I can conclude that the prospects for the 2021 economy (so relatively short term) are that we will see:
Improved GDP and Increased consumer spending; BUT
An increase in unemployment and inflation; AND
No change in interest rates.
Putting that in context and according to the FT, UK output fell 9.9 per cent in 2020, the fastest drop in 300 years and more than twice the drop during the financial crisis, laying bare the full scale of the pandemic’s impact.
And if we look at the consumer finance market, the retail store and online credit sector reported new business 6% lower in December than in the same month in 2019, and fell by 5% in 2020 overall. Credit card and personal loan new business together fell by 24% in December compared with the same month in 2019, and decreased by 22% in 2020 as a whole.
The speed, and apparent success of the vaccine programme has been considerable with milestones being achieved all along the way. And it is for this reason that the Bank of England expects an economic recovery from Spring- and that is the main point to take away from these few words. Look elsewhere and other commentators are even suggesting nothing short of a Q2 and Q3 rebound as the economy becomes more confident, UK output recovers, consumer demand being matched with new found freedoms, and all of us with a new haircut to bring hope above all hope.
UK economic output fell 9.9 per cent in 2020, the largest drop in 300 years and more than twice the fall during the financial crisis, laying bare the scale of the pandemic’s impact.