Today's retail sales data confirmed how weak the British economy has become, with experts expecting the country to slip back into recession.
Retail sales showed meagre growth last month as cash-strapped consumers cut back spending despite summer sale discounts. According to the Office for National Statistics, sales volumes grew by 0.2% in July from the previous month, leaving sales unchanged from last year's level. The City had expected 0.3% monthly and annual gains, as retailers slashed prices aggressively.
This is no surprise as Chris Williamson, chief economist at Markit, said: "Such weak spending is no real surprise. People are worried about job security, and incomes are being squeezed by higher prices. After inflation, real take-home pay is falling by over 2% per annum. Concerns about the economic outlook are also causing shoppers to hold back on making big-ticket purchases."
Nick Beecroft, senior markets consultant at Saxo Bank, was even gloomier. "If anything, the data just serves to confirm the general picture of an economy which can be described as, at best, moribund, but may well look like it's falling off a cliff by the time we see August's figures."
Today also saw a 4.5% fall in the FTSE continuing the falls of the recent period unsurprising as every piece of economic data that has come out recently has been weaker than expected.
Yesterdays British labour market data showed broad-based weakness, with slowing employment, rising unemployment, falling hours, falling vacancies and rising redundancies. Further significant increases in unemployment probably lie ahead for coming months.
Young people unemployment rate is 20.2% with nearly 1million 18-24 year olds out of work and unemployment for women is at it's highest level since 1988 at 1.05million.
The government has no real plan to resolve the economic difficulties, they hoped was for an export led recovery, this depended on the strength of foreign markets, now with the eurozone crisis and the US budget problems, this hope is in tatters. They're dogmatic view of not having a plan b, is likely to see years of no/very low growth and economic hardship.