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When will people admit Germany is in an economic depression? | Notayesmanseconomics's Blog
Today has brought more detail on what has become a long-running saga.One version of it has run for around 3 years. But another has run since the GDP data around 2018 was revised lower meaning that a fair bit of the German contribution to the "Euro boom" faded away. Below is the latest update. Business…
The Thames Water story shows how incompetent the UK political class has been | Notayesmanseconomics's Blog
Today's story has been a slow motion car crash for some years. It is a tale of theft and incompetence but as we see so often the rules for such things are very different when you have an establishment willing to look the other way. After all any proper inquiry would expose the incompetence of…
With 100% mortgages back and more interest-rate cuts planned the Bank of England wants even higher house prices | Notayesmanseconomics's Blog
This morning the research student presenting the morning meeting at the Bank of England will be struggling to keep a beaming smile off their face. Annual UK house price growth was marginally stronger in May at 3.5%, compared with 3.4% in April. House prices rose by 0.5% month on month, after taking account of seasonal…
The ECB is preparing for more interest-rate cuts | Notayesmanseconomics's Blog
This Morning has brought a raft of Euro area economic data but before I get to that I want to look at the words of ECB President Christine Lagarde in Berlin on Monday. One part was truly extraordinary even for her. The ongoing changes create the opening for a “global euro moment”. Also calling for…
Argentina will have to choose between monetarism and intervening in the exchange rate | Notayesmanseconomics's Blog
Yesterday brought some good news for the economy of Argentina and it was in an area that i making the news in so many different areas at the moment, bond markets. Argentina has raised $1bn from international investors in a vote of economic confidence for libertarian president Javier Milei seven years after the country last…
Is Japan and its bond market now on the precipice? | Notayesmanseconomics's Blog
The last year or so has seen quite a reversal for one of my main subjects which is Nihon or Japan. For years and indeed decades the Japanese bond market was seen as the Widowmaker where selling just ended up with you bailing out with losses. Indeed for much of the period you found yourself…
The UK government has lost control of spending and thus fiscal policy | Notayesmanseconomics's Blog
Over the weekend I noticed a flurry of Financial Times articles on a subject that we have been examining for months now. This is significant in the sense that it is linked to the UK establishment and I have described it in the past as the Bank of England house magazine. A global bond market…
The UK has some better economic news from Retail Sales and energy prices | Notayesmanseconomics's Blog
This has been quite a contrary week, most evidenced by the yo-yoing of bond yields. So we should not be surprised that after two days of poor data for the UK economy we get some better news and we can start with this. Energy regulator Ofgem has today (Friday 23 May 2025) announced a 7%…
The UK Government borrows a “Black Hole” in a single month | Notayesmanseconomics's Blog
One of the features of life is that if you have what in military terms is called an open flank events will tend to expose it.This week has been one where the bond vigilante's have returned and in fact have been having a party even in Japan.So the UK really did not need this to…
Both UK inflation and the cost of living see quite a surge | Notayesmanseconomics's Blog
This morning has brought some bad economic news for the UK on the inflation and cost of living fronts.We were expecting a poor month as we return to my long-running theme that the UK is an inflation prone nation.It turned out that it was at the higher end of expectations. The Consumer Prices Index (CPI)…
China and Australia cut interest-rates to lower mortgage rates | Notayesmanseconomics's Blog
The economic news for today started early as we look across to the Far East and the Pacific Ocean. China on Tuesday cut its market-based benchmark lending rates, with the one-year loan prime rate (LPR) down to 3 percent from the previous reading of 3.1 percent. #XinhuaNews The announcement did not sit too well with…
How much does the US 30-year yield reaching 5% matter? | Notayesmanseconomics's Blog
Today we see quite a few economic strands come together and it highlights an area I first worked in nearly 40 years ago as September 2nd will be my anniversary. In one way this was triggered by the cost of living crisis but if we look further back we see that the fires were lit…
Japan sees GDP fall in spite of a surge in investment | Notayesmanseconomics's Blog
This morning the economic news has been made in the east in Nihon. Japan's economy shrank for the first time in four quarters in the January-to-March period. Private consumption was virtually unchanged for the first three months of the year. The Cabinet Office released preliminary gross domestic product figures for the first three months of…
The UK economy gets a boost from the GDP numbers | Notayesmanseconomics's Blog
This morning the Office of National Statistics has brought some welcome news for the UK economy. UK gross domestic product (GDP) is estimated to have grown by 0.7% in Quarter 1 (Jan to Mar) 2025, following growth of 0.1% in the previous quarter. So we have quite an acceleration compared to the end of last…
The Bank of England has an awful problem with UK bond yields | Notayesmanseconomics's Blog
Sometimes financial issues happen in a rush like we saw recently in the market response to the initial announcements on the Trump Tariffs. Although that can change quickly as I note that the US S&P 500 index is now up on the other. The other is less dramatic and thus can escape media attention but…
A good day for economics 101 is a bad day for the Unemployed and UK Chancellor Rachel Reeves | Notayesmanseconomics's Blog
It is hard not to have a wry smile at the timing of the UK jobs and wages figures being published the day after a parliamentary inquiry into UK official statistics and in particular these figures starts. There is an attempted response to this from the Office for National Statistics but first there is something…
UK Official Statistics are in quite a mess and require root and branch reform | Notayesmanseconomics's Blog
Today I thought that I would take a different tack because something very serious is happening and it is in an arena I have been involved in since around 2012. Let me open with the announcement that has triggered this and it is from Friday which was no doubt considered to be a good day…
The Bank of England put on rather a clown show yesterday | Notayesmanseconomics's Blog
Yesterday started well in Bank of England land as the research student on the duty rote kissed the piece of paper that told him or her this. House prices increased by +0.3% in April vs -0.5% in March • Average property price now £297,781 compared to £296,899 in previous month • Annual rate of growth…
The US Federal Reserve has done the right thing on interest-rates | Notayesmanseconomics's Blog
Last night the US Federal Reserve gave its latest policy statement on US interest-rates. That is significant in itself but it has an additional importance in that due at least partly to the changes in economic policy started by President Trump we are more than usually aware of the flaws in using GDP as an…
China cuts interest-rates and boosts the money supply or pushes on a string | Notayesmanseconomics's Blog
This morning brought news that we had been expecting. In fact the rumour mill was in action last night with the suggestion that the Chinese version of The Plunge Protection Team would be busy today. In order to better play the incentive role of structural monetary policy tools and guide financial institutions to increase support…
The Bank of England is preparing the ground for a series of interest-rate cuts | Notayesmanseconomics's Blog
Tomorrow the Bank of England will vote on UK interest-rates and as I pointed out on the 24th of April I am expecting a cut of 0.25% to 4.25%. This comes from the subject of the speech by Governor Bailey I looked at then which was economic growth. At the moment he is in a…
Who would have thought that Diana Ross was going to be so right about US GDP? | Notayesmanseconomics's Blog
This week has been one where the US economy has made the headlines and we have the employment report with its non-farm payrolls to go. Let me start with something that was a sea change compared to what had gone before. Real gross domestic product (GDP) decreased at an annual rate of 0.3 percent in the…
How can we trust UK official statistics when they keep making significant errors? | Notayesmanseconomics's Blog
As we arrive and the May Day holiday in much of Europe ( and enjoy if you celebrate it) we have the latest updates from the Bank of England. Before we get to that we can examine its favourite economic indicator provided by the Nationwide. “April saw a slowing in UK house price growth to…
Why the Bank of Japan should raise interest-rates substantially but wont | Notayesmanseconomics's Blog
Tomorrow the Bank of Japan will announce its latest policy decision and one perspective is simply that the interest-rate is 0.5%. So for all the talk and indeed media hype the largest inflationary burst in Japan for years and indeed decades has seen an interest-rate response totaling 0.6%. Speaking of inflation there has been more…
How low will the ECB cut Euro area interest-rates? | Notayesmanseconomics's Blog
It has been rather an extraordinary 24 hours or so in the Euro area and in particular for the Iberian Peninsula. Along the way Spain has gone from hero to zero and a rather literal zero as this. Spain’s grid ran entirely on renewable energy for the first time on April 16, with wind, solar,…
Negative interest-rates are back on the menu for Switzerland | Notayesmanseconomics's Blog
It may seem that today's title is rather contrary at a time when many Western countries have interest-rates higher than they have been for many years. But as I regularly point out the central banksters are much more enthusiastic for cutting interest-rates than they are at raising them. Look at the ECB for example which…
UK Retail Sales continue to look strong suggesting a positive Q1 GDP number | Notayesmanseconomics's Blog
This morning has brought another reminder that one should always take care with narratives. The mood music for the UK economy post the October Budget has been poor and this week we have seen disappointing numbers for the public finances and a purchasing managers or PMI survey suggesting the economy has started the second quarter…
Bank of England Governor Andrew Bailey prepares the ground for more interest-rate cuts | Notayesmanseconomics's Blog
Yesterday we heard from Bank of England Governor Andrew Bailey as he spoke in Leicester. I have been pointing out for a while now that the Bank of England has been stuck between a rock of the US Federal Reserve where interest-rate cuts are in the distance and the European Central Bank or ECB which…
UK Chancellor Rachel Reeves faces bad news on the public finances and economic growth | Notayesmanseconomics's Blog
This morning has brought news that brings several of our themes into play. For some time now I have been pointing out that the Western democracies have become fiscally spendthrift and addicted to deficits. The additional nuance came post Covid as one might think that there would be some retrenchment after the Helicopter Money splurge…
Should President Trump get his wish and see US interest-rates cut? | Notayesmanseconomics's Blog
Whilst we in the UK were enjoying the Easter break there has basically been one main story in the financial world, and as so often it has been led by President Trump. We are back to the era of government by Trump Tweet except this time around it was on Truth Social. Preemptive Cuts” in…
What can we expect on interest-rates from the Federal Reserve and the ECB? | Notayesmanseconomics's Blog
As we approach Easter we are seeing developments in a theme I noted on the 31st of March. In a nutshell I pointed out that the Bank of England was being pulled one way by the US Federal Reserve and in the opposite direction by the European Central Bank or ECB. Whilst we have seen…
How much confidence can we have in inflation numbers produced by the UK Office for National Statistics? | Notayesmanseconomics's Blog
Today has brought some UK inflation numbers which on the face of them give some hope of an improvement. The Consumer Prices Index (CPI) rose by 2.6% in the 12 months to March 2025, down from 2.8% in the 12 months to February. So we have a fall in the annual rate and by a…
The decline in UK payrolled employment is worrying for economic prospects | Notayesmanseconomics's Blog
Last week brought some welcome economic news for the UK as we were told by the Office for National Statistics that we had seen a strong start to 2025 in terms of economic growth and GDP. However this morning has brought news from the same source that should be deeply troubling for UK Chancellor Rachel…
Will China also blink in the tariff war? | Notayesmanseconomics's Blog
Events in the economic world continue to move very quickly. I note that at some point over the weekend President Trump responded to an issue I raised last Tuesday. Smartphones and several other categories of products will be exempt from sweeping tariffs imposed by the Trump administration earlier this month, a filing showed late Friday. That…
The UK GDP boost is welcome but we need to remember how erratic the monthly numbers have proven to be | Notayesmanseconomics's Blog
After a week and a bit when the news seemed grim with stock markets falling and then behaving like a casino accompanied by bond markets also looking troubled, I have some better news to report today. Monthly real gross domestic product (GDP) is estimated to have grown by 0.5% in February 2025, with growths in…
The economy of Italy remains a Girlfriend in a Coma | Notayesmanseconomics's Blog
In the midst of all the excitement over the past week or so it is important to keep track of other themes in play and this morning I noticed this from a country Bill Emmott described in economic terms as a "Girlfriend in a Coma" In February 2025, the seasonally adjusted index of industrial production…
The fiscal gambling of UK Chancellor Rachel Reeves faces ever higher bond yields | Notayesmanseconomics's Blog
The last week or so has been one of ch-ch-changes and one of them is where the UK has a vulnerability. The Bond Crash of 2025 US interest rate on a 30 year Treasury jumps to almost 5%. (@wmiddelkoop) Then it was almost inevitable. UST 30s topped 5% earlier. (@fullcarry) One way of looking at…
How will the economy of China respond to the Tariff Wars? | Notayesmanseconomics's Blog
The last 24 hours -actually a bit more as markets opened Sunday night UK time - have been quite something. But a relative calm has emerged except for one area which is China. For newer readers my theme for several years now has been that it has been in a type of economic depression due…
How will the central banks respond to the equity market plunge? | Notayesmanseconomics's Blog
Today we face a situation where the words in big friendly letters at the front of The Hitchhikers Guide to the Galaxy are appropriate. DON'T PANIC. Although we do immediately have an issue as we looking at the likely actions of a group of people who are prone to panic ( as we saw around…
The expected path for interest-rates around the world has been changed by the Trump Tariffs | Notayesmanseconomics's Blog
It has been rather an eventful week in terms of financial markets and economics as investors try to come to terms with a different looking situation. But a side-effect has been rather a quantum shift in bond markets and expected interest-rates. We looked at one feature of that yesterday in Japan where the Bank of…