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Guest Baffled_by_it_all

In the interests of a balanced debate. What does everyone think about the current manufacturing/consumer spending figures as reported on the front page and in the Telegraph?

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In the interests of a balanced debate. What does everyone think about the current manufacturing/consumer spending figures as reported on the front page and in the Telegraph?

Here's part of what Moneyweek had to say this morning:

"But looking more closely, the news isn’t all good. The CBI's retail sales figures were artificially boosted by the timing of Easter. This was reflected in the fact that most retailers considered sales to be poor for the time of year.

As for manufacturing, the CIPS survey also showed that input costs continued to rise, driven by high oil and energy prices. And some of the increase is feeding through to customers - output prices also headed higher.

And of course, higher costs don't just impact on manufacturers - retailers and consumers are also seeing their energy and transport bills soar, which has to have an impact on profits and spending power. This suggests that the upbeat tone to the latest round of surveys is unlikely to continue.

Especially as oil prices don’t seem likely to come down any time soon. Along with Iran’s nuclear ambitions and Nigerian unrest, the latest threat to energy security is left-wing populism in South America.

Bolivian president Evo Morales has renationalised the country’s gas fields, and sent in the military to occupy sites and refineries owned by foreign companies.

According to the BBC, companies will have six months to renegotiate contracts or they’ll be expelled. They will have to sell at least 51% of their holdings to the Bolivian government, with the state taking 60% of production from all fields, and 82% from the two biggest in the country.

“The pillage of our natural resources by foreign companies is over,” declared Mr Morales, who presumably intends to start pillaging them himself.

The impact on individual companies is small. In the UK, the most exposed group is BG, but Bolivia accounts for just 3% of its current production and 4% of its reserves.

But Bolivia has the second largest gas reserves in South America, behind Venezuela. And that means there are significant unbooked reserves which BG and other foreign companies would like to make use of, especially as finding new sources of gas and oil is becoming increasingly difficult and costly.

And of course, an added concern is that the revolutionary fervour gripping the likes of Bolivia and Venezuela will continue to spread through the region.

The soaring oil price is just one of the many tripwires that still threaten the global economy, says Morgan Stanley chief economist Stephen Roach in his latest research note, “World on the Mend”.

But even so, the usually bearish commentator now believes that prospects for the world’s economy are improving. He says that low inflation will allow central banks to raise interest rates in a slow and steady manner. This means that global imbalances – specifically the huge US trade deficit - have a better chance of unwinding gradually, rather than in a sudden and disastrous bust.

The cautiously optimistic tone is a far cry from the man who predicted a 40% chance of “a hard landing at some point in the next 12 to 18 months” only last September. But Mr Roach's turnaround may not be a good sign. When the most stubborn bears start to turn bullish, that’s often a signal that trouble lies ahead.

As Rob Cox says on breakingviews.com, and as Mr Roach admits himself: “the last time Roach felt so confident about the global economy was in 1999. That was just a few months before the onset of the devastating technology bust.” "

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I bought a £100 juicer last week - on Sat which was April. Took it back on Sun which is May so expect to see a big leap in April's retail figures only for them to plummet when the May figures are released! :P

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Guest Baffled_by_it_all

I just feel that the merest hint of good news is enough to rally public sentiment. Even though we're bearish about the market (some of us nervously so) then there'll be enough buyers to give things a zombie lurch forward.

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In the interests of a balanced debate. What does everyone think about the current manufacturing/consumer spending figures as reported on the front page and in the Telegraph?

Very temporary reprieve in both sectors.

Everytime I pass a petrol station the prices have gone up. I think that the BoE magicians may have to finally admit that the inflation bunny is in the hat and it wants to get out. Roll on the interest rate rises...

And as far as I'm aware debt growth continues at a great pace and unemployment is still going up.

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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