A British Utopia
As Easter and a long weekend approaches, you could be forgiven for thinking that here in Britain we are actually living in a veritable utopia. The measures of austerity that were introduced amidst much horror seem to be working, if you look at the figures anyway, and Britain is seen to be the example of how to counter the economic downturn.
Figures out yesterday showed that the average increase in UK weekly earnings was 1.7%, whilst annual inflation slowed to 1.6% in March. This was the first time in years that earnings outstripped inflation and highlights that we may finally enjoy an increase in spending power.
Unemployment rates are also dropping and, despite the delicious wine and cheese on offer in France, things seem to be much rosier over here, with unemployment levels of 6.9% in the UK compared to the 10.2% in France. Our Gallic neighbours are also suffering from a much slower growing economy (0.8%) than we are over here (2.7%).
Allied to that, we are also seeing GBP strengthen, especially against the US Dollar. If data and market sentiment continues in the same vein as it has done this week, then we could well see rates of 1.7000 in the near future.
Yesterday saw Janet Yellen take centre stage as she enforced how too little inflation was more of a threat than inflation rising above the Fed’s 2% target. Combined with the likelihood of keeping interest rates at these historically low levels, it’s very much “as you were” with the US.
Enjoy Easter, Currency UK will be back in on Tuesday! If you’re looking at something to do on Sunday, go along and cheer the girls of Chelsea Ladies as they take on last year’s champions, Liverpool at Wheatsheaf Park.