Closing post
Time to wrap up….
The UK economy may have slipped into a technical recession at the end of last year.
Forecasters at the EY Item Club believe there’s a good chance that UK GDP shrank a little in October-December 2023, following the 0.1% drop in July-September.
But, they’re also more upbeat about prospects in 2024 and 2025, as lower inflation and inferest rate cuts support growth.
The number of UK firms in critical financial distress has jumped by a quarter, to around 47,000.
Advertising chief Sir Martin Sorrell has warned that clients are concerned about geopolitical risks, such as US-China relationships, the Russia-Ukraine war, and Iran and the Israel-Hamas conflict.
In New York, the US S&P 500 index has hit a new all-time intraday high as stocks continue to rally on Wall Street…
…despite new signs that the US economy is slowing.
US shipping companies continue to avoid the Red Sea, as fears over Houthi attacks force them to sail around Africa instead.
China has vowed to crack down on officials who falsify economic data.
UK energy bills are expected to fall by the equivalent of more than £300 a year this spring after a drop in wholesale gas prices, helping households struggling with the cost of living crisis.
And here’s the rest of today’s business news so far:
A measure of the US economic cycle has ticked a little lower.
The Conference Board Leading Economic Index fell by 0.1% in December 2023 to 103.1 (2016=100), following a 0.5 percent decline in November.
🇺🇸 CB Leading Index MoM (Dec)
— DailyFX Team Live (@DailyFXTeam) January 22, 2024
Actual: -0.1%
Expected: -0.3%
Previous: -0.5%https://t.co/BpRhCg7Tgs
This means the LEI has contracted by 2.9% over the six-month period between June and December 2023, a smaller decrease than its 4.3% contraction over the previous six months.
Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators at The Conference Board, says:
“The US LEI fell slightly in December, continuing to signal underlying weakness in the US economy.
“Despite the overall decline, six out of ten leading indicators made positive contributions to the LEI in December. Nonetheless, these improvements were more than offset by weak conditions in manufacturing, the high interest-rate environment, and low consumer confidence.
