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The Economic Situation

Published online by Cambridge University Press:  26 March 2020

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Abstract

Only if the underlying upward trend in exports continues is output this year likely to do better than recover its loss in the second half of last year. This review of the economic situation begins in the first section with exports so far, the world economic situation and exports prospects. The second section deals with home demand and output. The third section sums up the outlook for the economy and the balance of payments.

Type
Articles
Information
National Institute Economic Review , Volume 20 , May 1962 , pp. 4 - 20
Copyright
Copyright © 1962 National Institute of Economic and Social Research

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References

Note (1) page 4 National Institute Economic Review, no. 19, February 1962, page 53.

(2) The seasonal adjustment probably removes some, but not all, of the hump in car exports. These rose particularly sharply from £7.7 million in the fourth quarter of 1961 to £12.1 million in the first quarter of 1962. Some of this must be once-and-for-all stock-building, and to this extent the first quarter figures, even after seasonal adjustment, may have been a little inflated.

Note (1) page 5 Securities and Exchange Commission and United States Department of Commerce Inquiry made in February 1962.

Note (1) page 6 Economic Survey of Europe in 1961. Economic Com mission for Europe, Geneva, mimeographed edition.

Note (1) page 9 The estimates of factory deliveries for export published with the orders figures are not strictly comparable with the figures of exports of engineering products given in the Trade and Navigation Accounts.

(2) Net new orders for engineering products showed a big increase in the fourth quarter, but this appears to have been mainly a seasonal change.

Note (1) page 11 Statistical Appendix tables 1 and 14.

(2) The National Insurance returns, for the third Tuesday of each month, show the following figures (in millions) of insured persons absent from work owing to sickness :

Note (1) page 12 Statistical Appendix table 3.

(2) The Board of Trade's seasonally adjusted series assumes a constant seasonal pattern for each type of asset, regardless of the purchasing industry. This does not seem to take sufficient account of the third quarter concentration of iron and steel expenditure. This affects the public sector as well, because the public sector includes that part of the steel industry which is not denationalised.

(3) Statistical Appendix table 5.

Note (1) page 13 National Institute Economic Review, no. 15, May 1961, table 3, page 16.

Note (1) page 14 Statistical Appendix table 14.

Note (1) page 15 Economic Survey, Cmnd. 1678, paragraph 18.

Note (1) page 16 In the past, the Trade Unions in the gas industry have normally negotiated successfully for the same size of awards as that given to the electricity supply industry.

(2) In the past annual changes in trading profits in manu facturing industry have been similar to changes in total company profits.

(3) The index of final prices measures the price of all goods and services sold in this country, plus exports. It tends to rise faster than the index of wholesale prices of manu factured goods, but more slowly than the retail prices index. From 1954 to 1961 the index of final prices rose 21 per cent, the wholesale prices of manufactured goods 16 per cent, and the retail prices index 23 per cent.

(4) Statistical Appendix table 11.

(5) National Institute Economic Review, no. 19, February 1962, table 2, page 6.

Note (1) page 17 ‘There is also good reason to expect increased buying of consumer durables on hire purchase. By this time next year total personal spending may well be up 4 per cent in real terms—a very large rise in relation to the average experience of recent years’. Chancellor of the Exchequer, Daily Hansard, Monday, 9 April 1962, col. 965.

(2) This view is set out in Economic Trends, September 1961.

Note (1) page 18 National Institute Economic Review, no. 19, February 1962, page 14.

(2) Statistical Appendix, table 17.

Note (1) page 19 R. L. Major, ‘Errors and Omissions in Balance of Payments Estimates’, National Institute Economic Review, no. 19, February 1962, page 57.

Note (1) page 20 There is in fact not much difference in character between some of the portfolio investment, included in the long-term capital account, and some of the investment recorded as an increase in overseas sterling holdings.