The omens for third quarter GDP (to be released on 14th November) are not good. Consumer spending probably fell outright, due to a combination of bad weather and sluggish growth in real wages. However, the evidence from business and consumer surveys is more encouraging, and any dip in GDP is likely to be shortlived. Firms plan to significantly increase the number of employees. Inflation has been temporarily depressed by discounts to clear unsold stock after the unusually heavy rains, but the trend remains upwards.
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