Blog: Chris MercerWe're doomed. We're saved. Actually, we might be doomed.

Chris Mercer | 25 January 2011

The topsy-turvy UK economy is lurching once more towards double-dip recession, this time with a dash of stagflation, and consumer confidence has plummeted.

The UK's economy shrank by 0.5% in the final quarter of 2010, surprising many of the so-called experts, who were expecting slight growth. Poor weather in December has been blamed for hampering retail sales. But, even without this, the economy would have been flat against the same period of 2009, said the Office of National Statistics (ONS), which released the figures today (25 January).

Drinks companies, alongside the entire consumer products sector, may have to grimace a little harder than we were expecting in 2011.

The spectre of a double-dip recession continues to loom, while a new threat has emerged in the form of prolonged stagflation - a period of relatively high unemployment and inflation coupled with economic stagnation. Consumer price inflation in the UK is running at close to 4%.

Consumer confidence in the UK, meanwhile, is at its lowest ebb for almost two years, according to the latest Household Finance Survey from Markit Economics. "January’s survey indicates that household finances deteriorated further from the already downbeat picture taken at the end of last year," said Tim Moore, a senior economist at Markit, yesterday.

"Little respite appears around the corner, as survey respondents reported the most pessimistic outlook for their finances since early 2009," Moore said. Markit surveys 1,500 UK adults every month.

UK chancellor George Osborne said today that the ONS data is "clearly disappointing", but he said that the Government's austerity drive will "not be blown off course". The ONS figures are preliminary and subject to review.


BLOG

Flavour stick "ages whisk(e)y three years in 24 hours"

Whisk(e)y companies spend a lot of money and effort ageing their products for that premium taste....

BLOG

US lacks bottle for craft soda revolution

PepsiCo created a stir last week with the news it is testing a product called Caleb's Kola, with some in the media claiming it was the beginning of a new “craft soda” category....

BLOG

Beer cocktails abound as SABMiller gives Peroni a push

SABMiller's bid to widen the appeal of beer is very much in evidence at its latest 'House of Peroni' - with beer cocktails and a bigger bottle for the Italian lager brand on offer. ...

BLOG

The just-drinks Weekly Round-Up

Here's a round-up of the big stories on just-drinks last week, featuring PepsiCo, SABMiller, the Scotch whisky category and the US wine market....

just-drinks homepage



Forgot your password?