DCSIMG

Comment: Osborne will happily accept any good news

Martin Flanagan. Picture: Adrian Lourie

Martin Flanagan. Picture: Adrian Lourie

  • by MARTIN FLANAGAN
 

AS ECONOMIC backdrops go for impending autumn statements, George Osborne could have done a lot worse than pondering the economic data out yesterday.

Manufacturing figures from the CBI’s industrial trends survey showed total order books and output growth at their highest since 1995.

It is further evidence of the deepening and broadening of the economic recovery. And it is made more welcome by how used we have become since the 1990s to the bigger and more successful services sector effectively getting manufacturing out of a hole in terms of the UK economy washing its face.

Other data showed that the public finances – the cleaning up of which the coalition government has all but made its raison d’etre – were better than expected in October.

Public borrowing fell 2 per cent to £8 billion from £8.2bn in October 2012, partly helped by stamp duty revenues rising as the housing market recovery takes hold.

Yes, there is the well-aired danger of a housing bubble developing. But Osborne won’t look a gift horse in the mouth at this stage of the political fencing with the Labour opposition.

Meanwhile, that useful informal barometer of consumer optimism, car production, also added to the goodwill factor. The Society of Motor Manufacturers and Traders (SMMT) said the number of cars built in October was up 17 per cent from October 2012.

Taking the troika of good news together, the nicely cantering public relations momentum ahead of his statement to the House of Commons surely sees the Chancellor much more relaxed than when preparing his autumn statement last year.

Back then the recovery had by no means gained as much traction as now, and in terms of the public finances it looked like the UK was suffering the pain of austerity without the gain of the governmental spending hairshirt.

This time Osborne may have something of a spring in his step at the despatch box, even with the obligatory “still much to do” political cliche still odds-on to be wheeled out. Looking better, but no complacency.

The “Two-Eds-are-better-than-one” on the other side of the chamber will no doubt counter that living standards in coalition Britain have slumped.

Given the raft of positive economic data, the Labour leders have little else in the locker to sling at the government than an allegation of a wallet-light recovery (which isn’t the worst arrow there has ever been).

A pattern is definitely emerging over markets

SABMiller’s interim results show the world’s second-biggest brewer reprising the tune of spirits giants Diageo, Heineken and a string of other big fast-moving goods companies.

To wit: the overall trend continues of emerging markets doing better than mature markets like Europe.

There has been some volatility in those emerging markets.

But SABMiller, like a lot of other big businesses, does not believe the short-term volatility discredits the overarching strategy of continuing to push the envelope in high-growth geographies, often bankrolled by the diminishing, though still sizeable, returns thrown off by more established markets.

Like Diageo, SAB believes there is particularly all to play for in Africa. A mass migration is going on to African cities and a massive aspirational middle-class is emerging over the Continent. The drinks industry is tapping it.

Twitter: @martinflanagan8

 

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