Economic Review – October 2019

Our monthly economic review is intended to provide background to recent developments in investment markets as well as to give an indication of how some key issues could impact in the future.

Overview

UK SET TO AVOID RECESSION

Better-than-expected gross domestic product (GDP) data for the latest three-month period has all but dispelled fears of a UK recession this year, although the current rate of growth does remain relatively lacklustre.

SIGNS OF SLOWING LABOUR MARKET

Official employment statistics suggest that the UK jobs market may have started to cool in recent months with the total number of people in work falling and the level of unemployment rising.

MARKETS

At the end of October, talk of renewed trouble in US China trade negotiations cast doubt on the possibility of a long-term trade deal. The news knocked sentiment recently lifted by growing optimism the Phase One deal would be concluded in November.

CONSUMER CAUTION ABOUNDS

The latest set of retail sales statistics suggest consumers have become more cautious about their spending in recent months despite the relatively strong growth in real wages witnessed over the past year.

ECONOMIC COST OF BREXIT

A study conducted by the National Institute of Economic and Social Research (NIESR) suggests the Brexit deal negotiated by Boris Johnson will ultimately leave the UK £70bn worse off than if the country had retained its EU membership.