Duncan Weldon
At 9.30 this morning we’ll get our first look at the Q4 GDP figures. They will almost certainly be very close to zero – and whilst the political debate will be shaped by whether they are just about negative or just about positive, they won’t (barring a really unexpected result!) tell us a great deal we don’t already know.
The expectation of both the OBR and independent economists (as surveyed by the Treasury) is that 2012 will be a year of very low growth overall. The simple fact is that the current recovery is historically weak – as best demonstrated by the below chart from NIESR:

But one often missed fact is that 2012 (on the OBR’s numbers) is, in one important regard, set to be a year of economic contraction. Whilst headline GDP growth is forecast to come in at 0.7%, the ONS forecast that the population of the UK will grow by 0.8%.
In other words per capita GDP (GDP per head) is set to fall this year.
Continue Reading →