UK Edition
Five signs this week that the UK economy is thriving post-Brexit
It has been some week for the economy. The FSTE 100 has hit historic highs, UK industry has been described as "booming back to life" and a string of Britain's biggest shops have revealed that they enjoyed huge success over Christmas.
In all, it's not quite the economic collapse of which we were so fearfully warned ahead of the EU referendum.
It's a little more complicated than that, of course, but here are five encouraging signs from the last week that show how Britain's economy is thriving.
1. Industry 'booms back to life' as manufacturing drives growth
The strong pace of growth enjoyed in the aftermath of the vote to leave the European Union looks set to be maintained thanks to the UK industry "booming back to life" towards the end of 2016.
Industrial production rose by 2.1pc in November compared with October, driven by strong manufacturing output and the reopening of the North Sea’s biggest oil field following a shutdown.
The Office for National Statistics (ONS) this week said manufacturing output increased by 1.3pc month-on-month in November, driven by growth in pharmaceuticals, which saw double-digit growth.
2. The FTSE 100 has hit historic highs
Britain’s leading index set a new record high and sealed an historic winning streak on Wednesday, after it rose for a 12th consecutive trading session.
The FTSE smashed the 7,300 barrier in intraday trade for the first time in its 33-year history, touching a fresh all-time peak of 7,328.51 in afternoon trade, before closing up 15.02 points, or 0.21pc, to 7,290.49. It has now also registered 10 record closing values in a row.
The remarkable run has been driven by the ongoing fall in sterling, which on Wednesday tumbled to its lowest level since the October 7 'flash crash’.
That said, 70pc of earnings on the FTSE 100 are dollar-related, so its success is not the strictest judge of the strength of the UK economy. Mining stocks and international companies, that benefit from earnings in currencies that are stronger than the pound, are sustaining the rally. The FTSE 250 may be a better barometer, and that is also doing well.
3. British consumers are still shopping
Shoppers and business owners have signalled their confidence by spending more - albeit fuelled by a growth in credit.
Consumer spending rose 2.6pc last year, with higher spending both online and in bricks-and-mortar retailers, according to figures from Visa.
A string of big retailers also enjoyed better-than-expected Christmases.
Marks & Spencer is in the midst of a turnaround after posting a long-awaited rise in clothing sales, while retailers such as Ted Baker and Joules provided fresh cheer to the sector after posting upbeat sales despite rising concerns that UK consumers prefer to spend their money in restaurants rather than shops.
And Sainsbury's enjoyed a record week over Christmas as supermarkets enjoyed a bumper festive season this year. Extra trading days led to shoppers making a last dash to buy festive food in the week before Christmas.
4. Housebuilders are looking strong
Housebuilder Barratt Developments expects pre-tax profits for the six months to December to be up 7pc thanks to a strong demand for new homes. It said completions outside of the capital are at their highest level in nine years.
Taylor Wimpey meanwhile is unfazed by post-referendum uncertainty in the market. The company, which is one of the biggest house builders in the country, said that trading had been "robust" in the second half of the year.
And last week another housebuilder, Persimmon, reported a a jump in revenues and sales thanks to “healthy customer demand for new homes” since the UK voted to leave the European Union.
Shares in housebuilders tumbled after the EU referendum on June 23, on fears that it would put people off moving house. But so far it appears people are willing to risk house moves - they still need somewhere to live, after all.
5. Even Mark Carney does not seem that gloomy
The Governor of the Bank of England said on Wednesday that Britain's decision to leave the EU no longer poses the biggest domestic risk to financial stability, and then signalled that the economy's resilience would prompt the Bank to upgrade its UK growth forecasts within weeks.
Mr Carney told MPs on the Treasury Select Committee that the risks associated with the vote to leave the European Union had receded, while the market turmoil predicted by some had not materialised.
His comments were significant because the Governor was sharply criticised by some pro-Brexit MPs for its negative forecasts on the likely impact of the decision before the vote.
But it's not all plain sailing...
With good news pouring in, it would be tempted to get carried away. Well, don't. There are still some serious problems, such as:
Prices are set to rise
Shop prices are rising across the UK's supermarkets once again for the first time since 2014, according to fresh industry figures by Kantar Worldpanel.
After 28 months of deflation in the market, like-for-like grocery prices have increased by 0.2 percentage points to bring a return to inflation.
On Monday, a litre of petrol reached an average of £1.18 - that's the highest since December 2014 according to the Department for Business, Energy and Industrial Strategy. And in the last five weeks, diesel prices have risen by 4p per litre.
Fears of a housing price crash
Property prices have climbed to dangerous levels in several advanced economies, raising the risk of massive price falls if markets overheat, according to the Organisation for Economic Co-operation and Development (OECD). While house price growth in the UK (outside of London) has remained strong, it is making it harder than ever for people to get on the property ladder, in turn pushing rents up.
Surprise construction slowdown
The UK construction industry suffered a surprise slowdown in October, with the number of new starts falling by 0.9pc compared with the previous month.
Overall, construction output fell by 0.6pc, while repair and maintenance work remained flat.
Widening trade deficit
Official trade data showed Britain's trade deficit widened by £2.6bn in November compared with the previous month, to £4.2bn.
This was mainly due to a £3.3bn increase in imports, which was only partially offset by a £0.7bn rise in exports. Kate Davies, a senior statistician at the ONS, said it was all "painting a mixed picture of the UK's economic performance".