BHETA ECONOMIC SNAPSHOT DRILLING B
HETA DIY sector director
Air fares were Paul
Grinsell says: “Never mind the election results, it was already a time
of financial worry for suppliers, retailers and consumers.
While spending in May was up 2.7% on the year, this was the slowest rate of growth since July 2016
according to Barclaycard’s
figures, with The British Retail Consortium’s study of shops’ sales also finding growth slowing down. For many commentators, the much greater concern, however, is that the growth that is evident is based on value and not on volume – which means whatever growth there has been may very well be to do with price rises. Talking about food sales, KPMG’s UK head of retail Paul Martin said that rising spending is likely to be caused by higher prices, as import costs increase due to the weakness of the pound. This is a comment that paints an even more worrying picture and while it’s never my inclination to sound gloomy, the value and volume question is one that is worrying many colleagues in our industry as well.
At the very least, we should be drilling down into reported figures with ever more rigour.”
Consumer Price Index – April 2017
The Consumer Prices Index including owner occupiers’ housing costs (CPIH, not a National Statistic) 12-month inflation rate was 2.6% in April 2017, up from 2.3% in March. The rate has been steadily increasing following a period of relatively low inflation in 2015 and is at its highest since June 2013.
www.diyweek.net the main
contributors to the increase in the rate in April 2017, although this balanced out a downward effect of similar magnitude in March 2017 and is due to Easter falling later than last year. Rising prices
for
clothing, vehicle excise duty and electricity also contributed to the increase in the rate. These upward contributions were partially offset by a
fall in motor fuel
INTO VOLUME AND VALUE
The latest facts and figures from the British Home Enhancement Trades Association – and what they mean for suppliers to the home improvement industry.
the second property stamp duty deadline that came into effect from the beginning of April. Gross mortgage lending for the first quarter of 2017 was therefore an estimated £59.1 billion. This is a 4% decrease on the fourth quarter of last year and a 6% decrease on the £63.0 billion lent in the first quarter of 2016.
prices
between March 2017 and April 2017, compared with a rise between the same 2 months a year ago. The Consumer Prices Index (CPI) 12-month rate was 2.7% in April 2017, up from 2.3% in March.
Retail Sales – April 2017 In April 2017, the quantity bought in the retail industry increased by 2.3% compared with March 2017 and by 4.0% compared with April 2016.
The underlying pattern, as
measured by the 3 month on 3 month estimate, showed a slight increase in April 2017 following a short period of contraction, increasing by 0.3%. Anecdotal evidence from retailers suggests that good weather contributed to growth. Average prices slowed slightly in April 2017, falling from 3.3% in March to 3.1% in April.
Mortgage approvals – March 2016 The Council of Mortgage Lenders estimates that gross mortgage lending reached £21.4 billion in March. This is 19% higher than February’s lending total of £17.9 billion, and 19% lower than the £26.3 billion lent in March last year. The sharp fall in year-on-year lending was expected, as March last year saw significant rises in activity as borrowers rushed to beat
House Price Index – March 217 Average house prices in the UK have increased by 4.1% in the year to March 2017 (down from 5.6% in the year to February 2017). This continues the general slowdown in the annual growth rate seen since mid-2016.
The average UK house price was £216,000 in March 2017. This is £9,000 higher than in March 2016 and £1,000 lower than last month.
Labour Market – UK Labour Market: Jan-March 2017 Estimates from the Labour Force Survey show that, between October to December 2016 and January to March 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 31.95 million people in work, 122,000 more than for October to December 2016 and 381,000 more than for a year earlier. The employment rate was 74.8%, the highest since comparable records began in 1971.
Construction Output – Jan-March 2017 Output in the construction industry grew 3 month on 3 month for the fifth consecutive period, rising by 0.2% in the first quarter of 2017; this is in line
with the estimate for construction output included in the preliminary estimate of gross domestic product for January to March 2017. Despite growing on a quarterly
basis, construction output fell for the third consecutive period month- on-month; decreasing by 0.7% in March 2017.
New housing experienced strong
growth in March, increasing month- on-month by 3.8%; month-on-year by 5.4%; and quarter-on-quarter by 0.2%.
Commodity Prices – April 2017 Prices for most industrial commodities strengthened further in the first quarter, while global agricultural prices remained broadly stable. Crude oil prices are forecast to rise to an average of $55 per barrel (bbl) in 2017 from $43/ bbl in 2016. Metals prices are projected to
increase 16% as a result of strong demand in China and various supply constraints, including labour strikes and contractual disputes in the case of copper, and environmental and export policies for nickel.
Agricultural commodity prices, which gained 1% in the first quarter, are anticipated to remain broadly stable in 2017, with moderate increases in oils and meals and raw materials offset by declines in grains and beverages.
Foreign Exchange Analysis – Reuters Mayy 22, 217 The dollar steadied close to six- month lows against a basket of currencies on Monday 22nd May, as investors took stock of a week of political turmoil in the United States and a resurgent euro zone economy. 1 GBP = 1.161 EUR 1 GBP = 1.298 USD
16 JUNE 2017 DIY WEEK 25
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