ECONOMY
UK the only G7 country heading for recessionThe Organisation for Economic Co-operation and Development has claimed the UK is the only one of the Group of Seven leading industrial nations expected to fall into recession thi
s year. The revised forecast by the OECD, a Paris-based think tank, suggested UK economic output will fall by an annualized 0.3 per cent in the third quarter and 0.4 per cent in the final three months of the year, moving the UK into a technical recession. The OECD commented: "The UK model has been revised to include the impact of residential property process – which are believed to play an important role in the current juncture." Chief economist at HBoS, Martin Ellis added: "I think there has got to be a strong possibility that the UK will record quarterly falls (in output) in the second half of the year. I think that is correct (the OECD forecast). In the second quarter, we had no growth in the UK as a whole and all the surveys point to things getting worse. I think that is a fair conclusion. There is a very strong likelihood the UK will be showing quarterly falls (in output) in the second half of the year." Commenting further on the situation throughout the rest of the G7, the OECD added: "Financial market turmoil, housing market downturns and high commodity prices continue to bear down on global growth Banks appear to have recognized most of the losses and write-downs related to sub-prime securities. Continued financial turmoil appears to reflect increasingly signs of weakness in the real economy, itself partly a product of lower credit supply and asset prices. The eventual depth and extent of financial disruption is still uncertain, however, with potential further losses on housing and construction finance being one source of concern."
(The Herald)Scotland still swerving the worstDespite the gloomy forecast from the OECD, Scottish economic output is expected to continue to rise until at least the first quarter of 2009. The Bank of Scotland Index of Leading Indicators is predicting annual growth of Scottish GDP will slow from 2.2 per cent at the start of 2008 but will continue to show positive growth of 1.5 per cent into the first quarter of 2009. Martin Ellis, chief economist at HBoS, hailed the greater strength in the Scottish labour market as a major factor in the economy north of the Border appearing to weather the economic storm. He commented: "I think that is a key one, yes. We have seen the Scottish labour market weakening but it is holding up better than for the UK as a whole. I think that is a key reason why we are seeing a more gradual slowdown north of the Border. The housing market as well – it is subject to the same kind of pressure as the (rest of the) UK (but) it is under less downward pressure because of the relatively god housing affordability. Although we expect declines in (Scottish house) process, we do not expect as much (as UK-wide). The impact on consumer spending and confidence will be less marked than for the UK as a whole."
(The Herald) Read all today's economics news from scotsman.comFOOD, DRINK & AGRICULTUREBelhaven helps push through financial weatherGreene King, Britain's biggest regional pub and brewing company, was bolstered by strong trading in Scotland despite the firm revealing wider consumer confidence and spending are flagging. Shares in the group fell by nearly 10 per cent at one point in the face of the news that Greene King's 320 pubs in Scotland, through its ownership of Belhaven, had seen like-for-like sales rise 4.6 per cent in the 16 weeks to August 24. In a statement, the group said: "Market conditions remain challenging as consumer confidence continues to weaken and consumer expenditure continues to contract."
(The Scotsman) Read all today's food, drink and agriculture news from scotsman.comINDUSTRYHousing still troubling construction industryNew figures from the Chartered Institute of Purchasing Supply have revealed that the housing sector continues to be the Achilles heel of the construction industry. The new reported showed that the key measure of the industry's activity was up compared to the previous month but was dragged down by the sluggish housing sector. Director of professional practices at CIPS, Roy Ayliffe said: "Housing was again the Achilles' heel of the construction sector, as August data signalled nine consecutive months of housebuilding decline. In an attempt to cope with the onslaught of rising prices, difficult trading conditions and narrowing confidence, purchasing managers were forced to further reduce levels of procurement activity, while more jobs were axed." Chief economist for Global Insight, Howard Archer added: "Although the construction purchasing managers' survey for August showed some improvement compared to July, it is still a very weak report which indicates that the sector remains in a bad way." He added: "The modest improvement in the August purchasing managers' survey does not significantly dilute belief that the construction sector is now firmly in recession."
(The Scotsman)Clyde up on conveyor successA record order book was revealed by Clyde Process Solutions yesterday with a new conveyor system which offers cheaper and greener solutions to traditional conveyor belts proving particularly popular. The Glasgow group, which specializes in material handling systems announced orders had been strong for the pneumatic conveying system with the iron and steel sector proving particularly enthusiastic for the innovative system. The pneumatic system sees materials blown through an enclosed pipeline and have proved to be less polluting than traditional belts. Clyde, which is chaired by Scottish engineering entrepreneur Jim McColl, revealed an order book worth £34.9 million at the end of July, the group's strongest ever order backlog and a 63 per cent increase on the £21.4 million booked last year. Chief executive Alex Stewart commented: "The group has made excellent progress this year, with the demand for low-energy, low-maintenance, and environmentally enhancing solutions growing strongly across the majority of our key customer markets."
(The Scotsman) Read all today's industry news from scotsman.comTECHNOLOGYLinn back in profitA paradigm shift in customer behaviour is being welcomed by hi-tech audio group Linn Products as consumers apparently seek higher sound quality in their digital music. The Eaglesham based group book pre-tax profits of £500,000 for the eight months to the end of June against a £2.1 million loss for the 12 months to the end of October 2007. Chairman Ivor Tiefenbrun commented: "In a market as tough as this one, with recession looming, I think people are asking themselves what really matters. They are choosing their priorities, and at the top of the list they're coming up with family and friends instead of big holidays and new houses. It's these kinds of attitudes that are driving people toward the kind of high0end product that we produce."
(The Herald) Read all today's technology news from scotsman.comPROPERTYEdinburgh house prices fallHouse prices in Edinburgh have fallen for the first time in 37 years, with the average house price in the Capital falling by 6.5 per cent to £201,517. City estate agent Willie Hunter commented: "These figures show that those sellers who wish to secure a sale are now starting to accept the change in market conditions we have witnessed over the last few months. Most sellers are also in a position where they are looking to purchase a new home, so they are able to balance accepting a lower offer on their current property to take advantage of their stronger negotiating position when they come to buy."
(BBC Scotland Online) Read all today's property news from scotsman.com
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