After the good
personal news I shared in my blog last week, there's been some heartening news
on the economy this week.
The CBI's latest quarterly poll shows that
the services sector, which accounts for two thirds of the UK economy, is
growing at its fastest rate for six years. Last week, the Office for National Statistics
lifted its second-quarter estimate for GDP growth from 0.6 per cent to 0.7 per
cent. The EEF, the manufacturers' organisation, said that for the first time
more members were reporting that the cost of new borrowing lines was falling
than those reporting it was rising. The Bank of England's Deputy Governor
suggested the Bank was sending a 'clear signal' that interest rates would not
be raised any time soon reiterating the commitment made early in his reign by
the new Governor Mark Carney.
The editor of our own magazine, Credit
Management, drew attention to a number of other positive indices in his column
in the September issue which hit doormats at the end of last week so perhaps
the CBI is right in interpreting their numbers as evidence of a further build-up
of momentum. Certainly, the conversations I'm having with businesses and
organisations suggest an underlying sense of confidence that was missing a few
months ago.
Few people seem to be overly buoyant but
they do at least seem to be moving from A glass half-empty to glass
half-full mentality. In the early days of this recession when the debate was
raging as to whether it would be V or U shaped, I remember one economist saying
it would be bath-tub shaped, with the economy bouncing along the bottom for a prolonged
period. It was a description I shamelessly stole and has proved to be pretty
accurate.
I don't think we're off the bottom yet but
I think we're looking upwards now rather than constantly looking behind us, and
it does feel like momentum is building. Knowing how important confidence is to
achieving recovery, let's do our bit by talking ourselves out of the bath tub.
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