BHETA ECONOMIC SNAPSHOT


TIME TO GET THE FACTS


The latest facts and figures from the British Home Enhancement Trades Association – and what they mean for the home improvement industry.


B and HETA DIY sector


director Paul Grinsell says: “The letter has been sent, two years of negotiations are finally underway


and whatever happens as a result, suppliers, distributors, retailers and consumers have to do their best to keep focused on maximising the day to day. Ideally, of course, they should also be planning for the future but, with so many uncertainties and so few absolute facts, being truly strategic can seem ever more challenging. “So, while we can only continue to speculate on key factors like trading terms and the movement of labour, we can make it a priority to keep abreast of the influential facts that can be accessed. To make that a little easier therefore, BHETA has updated its monthly Economic Snapshot to include a few more key statistics – specifically three new sources of information. In addition to the usual indicators, we have added Construction Output, Commodity Prices


Foreign Exchange


Analysis. In these complex, volatile times, the more data we can access the better!”


Consumer Prices Index - February 2017 The


Consumer Prices Index


including owner occupiers’ housing costs (CPIH, not a National Statistic) 12-month inflation rate was 2.3%


in February 2017, up from 1.9% in January. The rate in February 2017 was the highest since September 2013, having steadily increased since late 2015.


Rising transport costs, particularly for fuel, were the main contributors to the increase in the rate. Prices for food increased by 0.3% between February 2016 and February 2017, following 31 consecutive months of prices falling on the year.


Retail Sales in volume & value – February 2017 Estimates of the quantity bought in retail sales increased by 3.7% compared with February 2016 and increased by 1.4% compared with January 2017; this monthly growth is seen across all store types.


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The underlying pattern, as suggested by the three-month-on- three-month movement, decreased by 1.4% for the second month in a row; the largest decrease since March 2010 and only the second fall since December 2013. Average store prices (including fuel) increased by 2.8% on the year, the largest growth since March 2012; the largest contribution came from petrol stations, where year-on-year average prices rose by 18.7%. Online sales (excluding automotive fuel) increased year-on-year by 20.7% and by 3.3% on the month, accounting for approximately 15.3% of all retail spending.


Mortgage Approvals – January 2017 The estimate of gross mortgage lending for January is £18.9 billion, up 2% compared to a year ago. First-time buyer numbers continue to recover in 2016, but home mover numbers remain weak. Remortgage activity grew 14%


over the course of last year, as competition, along with base rate cut and launch of the Term Funding Scheme, have kept mortgage rates at historic lows.


House Price Index


– Monthly house price inflation – January 2017 Average house prices in the UK have increased by 6.2% in the year to January 2017 (up from 5.7% in the year to December 2016), continuing the strong growth seen since the end of 2013. The average UK house price was £218,000 in January 2017. This is £13,000 higher than in January 2016 and £1,000 higher than last month.


UK Labour Market


– Three months to January 2017 Estimates from the Labour Force Survey show that, between August to


October 2016 and the


months to January 2017, the number of people in work increased, the number of unemployed people fell, and the number of people aged from 16 to 64 not working and


not seeking or available to work (economically inactive) also fell. There were 31.85 million people in work, 92,000 more than for August to October 2016 and 315,000 more than for a year earlier. There were 23.34 million people working full-time and 8.52 million people working part-time.


Construction Output – January 20117


In January 2017, construction output fell by 0.4% compared with December 2016. However, output grew on a three-month-on-three- month basis by 1.8%. Repair and maintenance fell 1.3% month on month in January, with decreases in public housing and non-housing repair and maintenance. All new work showed signs of flattening out with growth of 0.1% in January 2017, but continued to grow in the latest three months compared with the previous three months at a rate of 2.1%.


Commodity Prices – January 2017


In January 2017, all commodity price indexes increased. Energy prices and non-energy commodity prices were up by 0.7% and 2.0%, respectively. Raw materials also rose by 2.5%, and fertilisers by 4.3%. Likewise, metals and minerals increased by 1.2%, and precious metals by 3.0%.


Foreign Exchange Analysis – Reuters: March 22, 2017 The pound


flattened out on three


Wednesday, March 22 after hitting its highest levels in almost four weeks; speculation that the Bank of England will raise rates within the next year cooled by broader concerns about a Brexit-driven slowdown in the UK economy. Sterling has surged 3% in the past week, driven by a turnaround in the dollar. 1 GBP = 1.156 EUR 1 GBP = 1.248 USD


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