Daily Brief – UK Growth

UK Growth

To refresh your memories, UK Growth fell 0.1% in July and the hope or more accurately the expectation was that July was an aberration which would be rectified when the men with the clipboards reported on UK Growth for August. In the case of Chancellor Reeves, that expectation was rather more of a prayer given her promises to deliver on the no small matter of UK Growth. In the event August growth came in at an insipid 0.1% piling further pressure on Chancellor Reeves. It would normally be expected that Sterling would weaken on that news and the increasing likelihood of a reduction in UK interest rates sooner rather than later, but as we wrote yesterday, US Dollar is weakening across the board which has meant Sterling has been bolstered at this point instead of weakened.

GBP/USD 1.3440.

World Demographics

An illustrative 2025 chart produced by the United Nations of the top 25 births versus deaths by country was released this week. Unsurprisingly, India was pretty much at the top of both charts with 23 million births and almost 10 million deaths so a net +13 million. Second place for births China, on the other hand, managed 9 million births and 12 million deaths, so -3 million. Third most fecund place, Nigeria scored 8 million births and 3 million deaths, so a net +5 million. Next is Pakistan, also a net +5 million. DR Congo in 5^th with a +4 million. The USA managed a net +1 million. Needless to say, the Old World does not feature in the births chart but the UK, France, and Italy all make it into the Top 25 on the deaths as does Japan of course; so that is the overall picture: the populations of the New World growing while the Old World is shrinking.

EUR/USD 1.1660.

EU House prices

Between 2014 and 2024 EU house prices rose an average of 50%, however in each of Hungary, Lithuania, Czechia, Portugal, Estonia, and Bulgaria house prices have shot up by an average of 200%. Of course demand has been a prime driver but those house prices have been forced up by higher interest rates, increases in short term rentals and a lack of new construction. There are certain hotspots where overtourism has driven demand to mad levels such as Barcelona in Spain and there is no doubt that the shift from hotels to AirBnB by younger visitors has played a major part in driving up property prices. Portugal is judged to have a housing market that has over-reached due to all of these factors and is estimated to be 35% over valued according to a recently published European Commission report.

EUR/JPY 176.44.

Robbie The Pict

RTP is an activist campaigner in the long running saga of the non payment of tolls to use the Skye Bridge. When it was opened exactly 30 years ago in October 1995, motorists were charged GBP4.70 each way. Not all of those canny Scots motorists paid the toll and that decision paid off, since the toll was indeed scrapped when the Scottish Government bought the bridge in 2004. What did not disappear were the non payment convictions. Robbie the Pict, who changed his name from Brian Robertson and who founded the mini state of Pictland in 1977, has 130 unpaid fines to his name, and is leading the fight to get those convictions overturned. As you can see from this tale of Pictland, news is a bit sparse on the Isle of Skye.

EUR/GBP 0.8676.

I Just Called To Say I loved You

This day in 1987 the Manchester born and Aussie emigre group The Bee Gees became the only group to have a UK Number 1 in each of the 3 decades 60’s, 70’s, and 80’s with this number which turned out to be the brothers’ 5^th and final Number 1. Not that that held them up in the slightest with their vast playbook of songs that they either performed or produced or both over their long and glittering careers.

I couldn’t figure why you couldn’t give me what everybody needs,
I shouldn’t let you kick me when I’m down, my baby.
I find out everybody knows that you’ve been using me,
I’m surprised you let me stay around you.
One day I’m gonna lift the cover and look inside your heart,
we gotta level before we go and tear this love apart.

There’s no fight you can’t fight this battle of love with me,
you win again,
so little time, we do nothing but compete.
There’s no life on earth, no other could see me through,
you win again,
some never try but if anybody can, we can,
and I’ll be, I’ll be following you.

Have a Great Weekend!

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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