We saw plenty Brexit-related headlines last week, after the government suffered its first Parliamentary defeat over the Article 50 bill. Theresa May insisted her plan to trigger Brexit before April “remains unchanged”, despite the House of Lords trying to force the government into guaranteeing the rights of all EU citizens currently living in the UK. The Prime Minister is “confident” the Lords’ amendment will be voted down when the bill returns to the Commons.
Our newspapers and airwaves are dominated not only by Brexit, of course, but also the spoken and tweeted words of Donald Trump. The US President gave his first speech to Congress last week – an address generally seen as more statesmanlike than his previous efforts.
I’m writing this from Rome, where Former Prime Minister Matteo Renzi just stepped down as leader of the centre-left Partito Democratico. Italian politics, once again, faces chaos.
Renzi previously resigned as Premier, having lost a botched referendum on constitutional change last December. Once tipped as Italy’s political savior, the 42-year old former Mayor of Florence must now win a renewed leadership battle if he is to restore his political credibility.
“It’s our expectation that rate increases this year will be appropriate,” said Janet Yellen last week. The Federal Reserve boss was signaling that US interest rates will keep going up.
America’s central bank has increased rates only twice in the past 10 years. The last time, though, was as recently as December 2016. If the Fed does raise rates this year too, that would be hugely significant – suggesting the global interest rate cycle has well and truly turned. It would also pose a danger that financial markets could plunge.
“The biggest barrier to social mobility and social progress is our broken housing market,” said Sajid Javid, while launching his long-awaited housing white paper last week. “Fixing it means taking on tough vested interests”. The Communities Secretary is right on both counts. But if this white paper is a genuine guide to future government action, it isn’t up to the job,
Over the last twenty years, amid soaring demand, we’ve built around two and a half million too few homes across the UK. This yawning supply-demand gap has made ownership evermore unaffordable. The average house today costs almost eight times average earnings – an all-time record, the ratio having doubled since 1997.
Aaron Senessie is a maths teacher at a leading London secondary school. Whitney Joseph is a trainee lawyer in the City. A couple for several years, and now in their late-20s, Aaron and Whitney want to buy a modest home close to Whitney’s parents in Essex.
“It’s an uphill struggle – we’re saving hard, but always battling rising prices,” Aaron tells me, as part of my recent Channel 4 Dispatches investigation into UK house-building. “It’s really upsetting,” Whitney continues. “We’re hard-working people with good jobs – and we haven’t got a chance”.
The Bank of England has dramatically upgraded its UK growth predictions. Just like HM Treasury, the International Monetary Fund and all those other official bodies that took an astonishingly pessimistic view of Brexit, the “Old Lady of Threadneedle Street” has somewhat changed her tune.
Ahead of last June’s referendum, Bank Governor Mark Carney warned of “a technical recession” – two consecutive quarters of shrinking GDP – if we voted to leave the European Union. Even in August, as the economy remained buoyant despite the Brexit result, the Bank was forecasting growth of just 0.8pc in 2017.
I’m pleased Theresa May has been talking directly with Donald Trump about the UK-US free trade deal. Everyone with the best interests of the British economy at heart should also be positive – whether they back Remain or Leave and whatever they think of the 45th President.
The US is, on most measures, the biggest economy on earth. Much maligned, sometimes deservedly so, America remains the world’s commercial, technological and financial powerhouse – to say nothing of its military strength.
So, it’s official. Donald Trump is US President. Now the inauguration has happened, the transformation is complete – from fast-talking business-man-turned-reality-TV-star to leader of the free world.
“The Donald” was elected, of course, on a wave of pretty lurid campaign rhetoric. The question now is to what extent he will act on his talk of “mass deportations” and “sky-high tariffs” – and the potential impact on the world’s biggest economy.
My Christmas holiday wasn’t entirely spent eating turkey sandwiches and watching television. A sizeable chunk was devoted, instead, to reading European Union Treaties, typing furiously at my keyboard.
The result is “Clean Brexit” – a paper I’ve written with the highly-regarded City economist Gerard Lyons, copies of which are doing the rounds at Westminster.
UK manufacturing expanded at its fastest pace for two-and-a-half years in December, according to survey data released last week. Britain’s PMI manufacturing index soared to 56.1, up from 53.1 the month before – where readings above 50 indicate growth.
Our all-important services sector – no less than four-fifths of our economy – is also buoyant. Services growth hit a 17-month high last month, the PMI services index reaching 56.2, as employers saw a pick up in both new orders and jobs.