The pound rises

Much of the media and some commentators were keen to give prominence to any fall in the pound after Brexit. They claimed it was the result of Brexit, ignoring the falls before we voted. They said it would lead to higher inflation in the UK than elsewhere. So far our increase in inflation has been mainly owing to oil prices, and is less than the US with a stronger currency and similar to Germany’s.

Will they today report the further surge in the pound, now 8% higher than its recent low against the dollar and Euro? Will they offer a political explanation for the improvement, as they claimed for the fall? And will they now predict less inflation as the pound rises?  Don’t hold your breath.

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58 Comments

  1. Mick
    Posted April 28, 2017 at 8:38 am | Permalink

    Couldn’t agree more , the bias BBC/Sky were falling over backwards when the pound went down, complete silence from them now it’s going up, watched question time last night talk about a loaded audience and panel, Mr Green was ambushed from all angles, there again what more can you expect from the BBC the sooner we don’t have to fund it the better

    • Bob
      Posted April 29, 2017 at 9:34 am | Permalink

      @Mick

      “what more can you expect from the BBC the sooner we don’t have to fund it the better”

      you don’t have to fund it, it’s your choice.

      I haven’t paid for a TV Licence for many years now, but I regularly have legal access to broadcast TV in hotels etc., and the diet of garbage that’s on offer just confirms to me that I made the right decision all those years ago.

      At home my Smart TV allows me access to loads of on-demand services (with the exception of iPlayer – thanks to the intervention of Tory Secretary of State for Culture, Media and Sport John Whittingdale).

  2. MPC
    Posted April 28, 2017 at 8:42 am | Permalink

    In terms of BBC reporting of such issues, I’ve always tried to see the best in the BBC and was interested in your recent post where you suggested the BBC sometimes creates rather than reports news. They did seem to be doing this yesterday, reporting: the EU is ‘united’ in its Brexit stance, our government is not and Angela Merkel says some in the UK are unrealistic in our expectations. But Mrs Merkel I believe was simply referring to some politicians who think there’s a preferential route to some sort of quasi EU single market membership post Brexit. This is not a view I’ve heard from anyone in Mrs May’s government.

  3. John Finn
    Posted April 28, 2017 at 9:59 am | Permalink

    John, I’m a bit disappointed to note that there are times when you seem to engage in “cherry picking”. Yes – the pound has jumped a bit in the last few days but if this is only a temporary blip it’s not going to have any effect on inflation. Similarly you’ve discussed retail sales whenever they’ve shown an increase but made no mention of them following the December, January and March falls – especially since they have clearly contributed to the slowdown in Q1 GDP (0.3%).

    I refer to you as a knowledgeable and trusted source and while you can’t be accused of providing false information, I would like to see a bit more “balance”.

    Reply I have talked about retail sales and the Easter effect. I also said I thought the very high growth rates achieved in retail sales last autumn after the vote were unlikely to persist.

  4. David Cockburn
    Posted April 28, 2017 at 10:07 am | Permalink

    If I held my breath waiting for balanced reporting of Brexit issues I wouldn’t last long.

  5. Antisthenes
    Posted April 28, 2017 at 10:07 am | Permalink

    Integrity and a regard for the truth has long since been abandoned by politicians and journalists. Especially by those who have left leaning political sympathies. As it is not very profitable. Applying both does not win votes or sell newspapers or increase viewing numbers.

    Jeremy Corbyn a self proclaimed man of principle is currently mired deep in the corrupt practice of bribing the electorate with the voters own money that they cannot afford to offer freebies to all. He does not stop at that he exaggerates and distorts unfounded claims of miseries and fails utterly to acknowledge the more truthful conditions of well being. So it is no surprise that bad news usually manufactured but not real is given vociferous exposure and good news is not even acknowledged let alone published.

  6. Prigger
    Posted April 28, 2017 at 10:17 am | Permalink

    The BBC enthusiatically reported the Pound’s rise. With smiling faces. 🙂 🙂 🙂
    They then said ” BUT ” 😉
    “This has led to a slump in the stock market for British companies ” 🙂 🙂 🙂 🙂 🙂
    “We shall go into the reason why, later…”

    • Jerry
      Posted April 29, 2017 at 8:52 am | Permalink

      @Prigger; “The BBC enthusiatically reported [..//..]”

      Other UK broadcasters are available…. Oh hang on, they all report the same facts in much the same tabloid style. The price of allowing market forces dictate how market forces are reported these-days I guess. 🙁

  7. Lifelogic
    Posted April 28, 2017 at 10:19 am | Permalink

    Indeed. The forces for remain are still very powerful indeed. They include the BBC, most of academia, the left wing press, channel 4, some large companies like airlines, most of the state sector, most politicians, 80% of the Lords, all the dire Libdims/Green types and still over half of the Tory party. Provably still the socialists T May & Hammond too.

    Of course if T May and P Hammond were not:- command economy, price fixing, wage fixing, red tape pushing, high tax socialists then the pound would be rather stonger still.

    Damien Green last night (on Questiontime) claimed that The work Place Pension (misguided, complex, red tape lunacy) was a great success as it has X million enrolled. Drivel, if you effectively force companies to enrole people by law it does not make it a great success if they comply they have no choice, you dipstick. The scheme is actually a disaster and a huge distraction for business owners from more productive activity. Shooting the economy in the foot as usual.

    What anyway is the point of someone saving in a pension if they have say credit card debts charging 20% +APRs to clear – as so many do Mr Green? Or if they have a low life expectancy for some reason. Misguided lunacy from government know best yet again!

  8. John Probert
    Posted April 28, 2017 at 10:57 am | Permalink

    I think the pound will continue to strengthen
    and the media will continue to be wrong

    • Lifelogic
      Posted April 29, 2017 at 7:07 am | Permalink

      It would even more so if Theresa May was not an interventionist, high tax, price and wages control, socialist.

  9. ian wragg
    Posted April 28, 2017 at 11:15 am | Permalink

    No comment from the Brussels Broadcasting Co. Just a report of £ up so and so.
    I do believe the pound is rising because the ROW now knows we will be leaving the German dominated would be superstate which is rapidly heading for failure.
    I have been reading the English version of the German news regarding Frau Murcky’s speech in which she calls us delusional. Saying that we cannot have any benefits of EU membership and must pay the divorce settlement before negotiations commence.
    Sadly it is she who is delusional, any MP or PM agreeing to her ludicrous demands for £50 billion settlement would be horse whipped.
    If your government caves in to this extraordinary demand you deserve to be obliterated in the polls.
    I have been trying very hard to come up with any benefits of EU membership not available elsewhere but haven’t yet found anything substantial.
    We bought our house in Cyprus in 1988 before they joined the EU so presumably we could buy another after we have left , incidentally we sold it in 2008 for about 3 times what we paid and it is now for sale again at half what we sold it for. EU membership hasn’t
    been very good for Cyprus.
    I think post EU Britain is seen as a safe, stable place to be and that’s why half the worlds population would like to claim our benefits.

  10. acorn
    Posted April 28, 2017 at 12:39 pm | Permalink

    The lesser the odds of any kind of brexit, the higher the Pound will go.

  11. hefner
    Posted April 28, 2017 at 12:48 pm | Permalink

    It always is instructive to confront various politicians’ declarations with day-to-day observations. Going this lunch time to one of the very rare dentists who still mix her majority private practise with an NHS one, I noticed a small paper describing the rates for various works from 1 April: band 1 now £20.60 (+4.5%), band 2 now £56.30 (+4.4%), band 3 now £244.30 (+4.5%).
    Wasn’t it a relief to learn that the value of these extra pounds spent by users of the NHS dental services are now 8% higher?

  12. Blatant remoaner
    Posted April 28, 2017 at 12:58 pm | Permalink

    It also looks like we may be on the verge of going into recession. If we do, will you Mr Rees-Mogg and your ilk accept any responsibility for that?

    Reply No we are not going into recession.

    • John Finn
      Posted April 28, 2017 at 6:21 pm | Permalink

      Did you think we were going into recession in 2016 (before the referendum) when Q1 growth slumped to 0.2% (following 0.7% growth in Q4 2015)?

    • John Probert
      Posted April 28, 2017 at 7:32 pm | Permalink

      We are due a cyclical recession but the economy continues to grow

    • MikeP
      Posted April 28, 2017 at 8:05 pm | Permalink

      A recession is generally accepted to be two successive quarters of negative GDP growth. There’s no sign of that, indeed today’s 0.3% quarterly growth is the same as France’s and the first of usually three attempts by ONS to give us the total picture with all data collected and they usually revise figures upward in their 2nd and 3rd reports. So how are we “on the verge” of recession ?

    • Lifelogic
      Posted April 28, 2017 at 8:49 pm | Permalink

      Indeed we are not going into recession. This is despite the daft high tax, borrow and waste socialism, price controls, wage controls, gender pay reporting and many other total insanities that we get from T May and P Hammond, almost daily.

  13. jeffery
    Posted April 28, 2017 at 1:02 pm | Permalink

    Unless John Redwood has access to some heavy number-crunching, he cannot know that US inflation is higher than UK inflation. Although Gordon Brown gave the eurozone HICP
    the same name (CPI) as the US inflation index when he introduced it into the UK, they are quite different measures. HICP is narrow (harmonised) and USCPI is wide ranging. The UKRPI is often thought closer to USCPI, although again not the same.

  14. Jerry
    Posted April 28, 2017 at 1:11 pm | Permalink

    Fumy how you try and talk about the GBP being up, the day the economic news is all about Q1 GDP falling…

    Sorry John but we’re not ignoring anything, people just point out what you chose not to mention -it’s call painting the whole picture, and we can do it here, were it is more convenient for you to reply (should you wish) or we can do it some-place else.

    • Leslie Singleton
      Posted April 28, 2017 at 5:36 pm | Permalink

      Attn Jerry–In your case some place else would be good

      • hefner
        Posted April 30, 2017 at 2:56 pm | Permalink

        I am afraid this whole blog would lose a lot of its interest if all people putting arguments differing from JR’s & the majority’s view were to be silenced/expelled.

        That’s already what the PM has been doing by calling the June election, because of “disagreeing voices in Westminster” in an otherwise homogeneous country. In Parliament, I did not notice that many dissenting voices despite the DM’s call for expelling the “saboteurs” (V.Illich).

        So, is she looking for a Ceaucescu-type of Parliament?

    • margaret
      Posted April 28, 2017 at 6:03 pm | Permalink

      From what I have read, although Q1 GDP is down, it is still higher than it was this time last year before the referendum.

      • Jerry
        Posted April 29, 2017 at 8:58 am | Permalink

        @margaret; Oh that’s OK then, GDP is dropping but is not lower than it was this time last year…

        • Edward2
          Posted April 29, 2017 at 7:42 pm | Permalink

          Considering you and the remainers were predicting recession this is the opposite to your predictions
          Over 2% annual growth.

          • Jerry
            Posted April 30, 2017 at 7:46 am | Permalink

            @Edward2; How many time, once again… The people you refer to made their predictions based on when we actually have Brexit, once we actually leave (not just decide to leave), we have not done so yet – so time and history is yet to judge on who made the correct predictions.

            We have not had over 2% growth, at best over the whole 12 months Q2 2016 to Q1 2017 we had 1.4% growth.

          • Edward2
            Posted May 1, 2017 at 9:54 pm | Permalink

            Rewriting history again Jerry
            Project Fear predicted doom for immediately after the vote day if we dared to vote to leave due to the severe shock to the financial markets.
            They spoke of recession
            They spoke of big rises in unemployment
            It never happened
            Growth is 2% and the IMF and others predict higher growth to come

          • Jerry
            Posted May 2, 2017 at 3:14 pm | Permalink

            @Edward2; You can interpret their words how ever you (or your fundamentalist Brexiteers briefing notes) wish…

            Even if you are correct, that some in Remain did mean after the vote and not actual Brexit – a mater of historical fact; since June 23rd June 2016, GBP is down (and still not fully recovered) whilst inflation is up (in real world prices). The economy could go North or South in the next 6 months, never mind the next 24 months or so.

            Reply Inflation is up by less than in the USA and about the same as Germany . UK has continued to grow at around 2%

          • Edward2
            Posted May 2, 2017 at 8:57 pm | Permalink

            Wriggling and struggling Jerry
            Bit like Abbott today

          • Jerry
            Posted May 3, 2017 at 3:07 pm | Permalink

            @Edward2; What ever way it is looked at, your comment about what Remain meant doesn’t stack. It is you who is suffering from the same problem as Diana Abbott was, when in a hole not knowing when to stop digging! In fact Abbott made more sense than you ever do, it was obviously from the start that she had mixed up her £k and £m and in the heat of the interview then made further silly mistakes, you are under no such pressure of thought.

    • Edward2
      Posted April 28, 2017 at 6:32 pm | Permalink

      Everything positive is just a random happening.
      Everything negative is due to Brexit
      It’s a mindset Jerry.

      • Jerry
        Posted April 29, 2017 at 8:55 am | Permalink

        @Edward2; Everything positive is just a random happening.
        Everything negative is due to Socialism or the EU
        It’s a mindset Eddie.

        • Edward2
          Posted April 29, 2017 at 7:39 pm | Permalink

          But I’ve not said that.
          I’m quoting you.

    • MikeP
      Posted April 28, 2017 at 8:09 pm | Permalink

      GDP is not falling, today’s provisional announcement from ONS was a 0.3% quarterly increase. Once they receive all the data (usually two further iterations) we might well expect this to be a little higher as in many previous estimates.

      • Jerry
        Posted April 29, 2017 at 6:28 am | Permalink

        @MikeP; “[it was a] provisional announcement from ONS”

        Then complain to, or about the failings of, the ONS -not to mention HMG, who set the reporting rules for the last two years plus.

        The fact is, on the figures to hand (and at a time when the ONS has to report), GDP in Q1 2017 has fallen, when measured against Q1 2016.

        • Anonymous
          Posted April 29, 2017 at 10:50 am | Permalink

          Jerry – I am braced for economic turmoil having voted for Brexit. I wish John wouldn’t bother trying to (for want of another phrase) put a positive spin on it.

          I think most Brexit voters are prepared for some big hits.

          Leaving the EU was always going to be expensive.

          • hefner
            Posted April 30, 2017 at 3:01 pm | Permalink

            A quality to be recognised to JR is his indefatigable optimism. A real heart-warming feeling comes from reading this blog.

    • acorn
      Posted April 29, 2017 at 8:24 am | Permalink

      Remember what Sir Robert Armstrong said, as British cabinet secretary, in the ‘Spycatcher’ trial (1986). “It contains a misleading impression, not a lie. It was being economical with the truth.”

      Anyway, the nearest thing that gets anywhere near the truth is ONS data, so have a read of https://www.ons.gov.uk/releases/monthlyeconomiccommentaryapr2017

    • Bob
      Posted April 29, 2017 at 9:48 am | Permalink

      “we’re not ignoring anything”

      “we’re” Jerry?

      Who do you refer to?

      • Jerry
        Posted April 29, 2017 at 5:19 pm | Permalink

        @Bob; Had you bothered to read our hosts diary entry you would know who the “we” are…

  15. Beecee
    Posted April 28, 2017 at 1:51 pm | Permalink

    They did however tell us that growth had slowed and threw in the occasional reference to Brexit.

    Ditto house prices dropping and also a piece on a manufacturer of stuff for the car industry whose spokesman was worried about something or other which I could not quite fathom.

  16. The Prangwizard
    Posted April 28, 2017 at 3:31 pm | Permalink

    They are reporting with some glee I think that the fall in GDP growth is a delayed Brexit effect.

  17. fedupsoutherner
    Posted April 28, 2017 at 3:40 pm | Permalink

    Of course they won’t John. All I heard today on the radio was that the economy was slowing down and that everything was dismal with nothing to look forward to. It must be true because Vince Cable said so and it’s all down to Brexit of course.

  18. Bert Young
    Posted April 28, 2017 at 4:34 pm | Permalink

    Our ” 3rd country level status” – according to Merkel , is supposed to leave us in an impossible position ; she believes we are deluded about our negotiating position . Publicly stated arrogance of this sort will not win her popularity in Germany or elsewhere . A rising £ against the Euro is a smack in her eye and a reality the defunct EU will have to take note of .

  19. Timaction
    Posted April 28, 2017 at 4:52 pm | Permalink

    They are the political elite, corporations, Bankers, mainstream media, the BBC and the great and the good with their own selfish agenda’s. Fake news is so common now everyone questions what they say. Especially when they talk to themselves about an issue stating their views, not the news or some correspondent who is thousands of miles away from the scene claiming facts in just another foreign Country. I’m afraid people have to research the news for themselves as there are so few true investigative journalists without a personal agenda. Peston anyone?

  20. Caterpillar
    Posted April 28, 2017 at 5:57 pm | Permalink

    Whilst such discussions may have influence during an election we must not lose focus on the lack of investment, and resource misallocation due to inappropriate tax structure and failed monetary policy. Please recall it was only last August 2016 that Mr Haldane was suggesting property to be a better ‘bet’ (my word) than pensions … not Joe Bloggs, but Mr Haldane!
    Whilst the tax structure ignores saving and investment, low interest rates misdirect resources (for reasons we have gone into before) and QE+Govt Borrowing misdirects control of resources, then productivity will continue to be poor etc. etc. Having called an election the Conservatives have an opportunity to turn this around – tax structure to drive saving and investment, take the interest rate decision back from the BoE and set it appropriately, govt money creation (regulated) for investment with spillovers (not QE+borrowing) … then grow some community banks so that some private sector money creation is locally sensitive. We have had 10 years of the current mess since the global financial crisis, let’s not have another five years of low investment, poor productivity and struggling pension schemes.

    It would be nice if this election the debate could move on – from up corporate tax and borrowing to spend more vs. lower tax and lower borrowing a bit less spend – to actually focus on medium and longer term growth … we have had 10 years of AD, how about a bit of AS?

  21. rose
    Posted April 28, 2017 at 8:07 pm | Permalink

    Not a mention of the pound rising that I have heard today but plenty about the falling growth rate of the GDP – nothing about GDP per capita of course – which is caused by Brexit and the falling pound. And a disgraceful piece on Northern Ireland and the EU in which reporters went round the streets of the Province suggesting to people that they had a choice of being poorer in the UK or richer joined to Southern Ireland and in the EU. The Irish Foreign Minister looked a bit nervous when they interviewed him from the Continent. They simply can’t afford it, and he knows it. Most disgraceful of all: they were comparing Northern Ireland to East Germany!

  22. Mark
    Posted April 28, 2017 at 9:24 pm | Permalink

    I was pleased to read (politico.eu report) that EU diplomats thought the Junkcer dinner with Mrs May went “really badly”. It sounds as though she is going to stand up to them, rather than accede meekly to their demands for exit bill payments and no simultaneous negotiations about the future. I am surprised they could have been so naïve as to believe that we would simply roll over. Juncker will of course not have any role to play in actual negotiations: the British should ban him from the room.

  23. Edward2
    Posted April 29, 2017 at 7:50 pm | Permalink

    It’s sad that Jerry and others delight in spinning national data to appear worse than it is.
    We are growing at 2% on an annual basis
    This is higher than any G7 nation.
    At a time when Project Fear predicted recession is negative growth and they also predicted rapidly rising unemployment when it continues to fall.
    Every bad news event we are told is due to Brexit
    When we get good news the same people say “we haven’t left yet”
    Pedantic arguments over Q1 versus Q3 trends are getting tedious in their negativity.

    • Edward2
      Posted April 29, 2017 at 7:53 pm | Permalink

      “IE ” not “is”

    • Jerry
      Posted April 30, 2017 at 8:12 am | Permalink

      @Edward2; Your comments remind me of those old style USSR Tractor Production figures, eternal good news, and accepted with about as much critical review by a devoted party member…

      The only people spinning figures are people like you Eddie, for example you cite the unemployment figures, yes those claiming JSA etc. is down but that is no measure of either the number of economically active people and thus the true economic health of the nation, nor how many people are in work but are under-employed. You do realise that anyone working 16 hours or more are classed by the HMRC and DWP as being in full time employment – even though almost everyone else would call it part-time.

      • Jerry
        Posted April 30, 2017 at 8:34 am | Permalink

        @Edward2 (et al), I want a strong UK, a very strong UK, both economically and socially, just as we had in the 1950s and for a time at least after, you on the other hand seem to be happy with the status quo that the UK has had its best days economically (yet support Brexit, or do you, I often wonder…), it is you who is ‘doing down’ the UK not me.

        • Edward2
          Posted May 1, 2017 at 9:48 pm | Permalink

          If you refuse to accept national statistics Jerry, then write to the Office of National Statistics explaining why you think they are wrong and you are right.

          • Jerry
            Posted May 2, 2017 at 3:26 pm | Permalink

            @Edward2; You’re wrong again Eddie! The ONS do not set the rules for JSA eligibility, the DWP does that, so the ONS merely compiles the stats based on data that those rules create. The ‘accounting’ is not in error, but the rules are.

          • Edward2
            Posted May 2, 2017 at 8:55 pm | Permalink

            More red herrings and pedantic nonsense

    • hefner
      Posted April 30, 2017 at 3:08 pm | Permalink

      Personally, this Q1/ONS stuff leaves me cold. The only question worth asking is for me: Is my family’s situation better following the referendum? Will it be following the June election? Will it be from April 2019?
      I certainly do not have the crystal-clear answer that the majority of the contributors here seems to have.

      • Jerry
        Posted April 30, 2017 at 7:13 pm | Permalink

        @hefner; “I certainly do not have the crystal-clear answer that the majority of the contributors here seems to have.”

        Probably because, like me, you also do not have that crystal-ball as they appear to have.

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    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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