An interesting article from the FT considering whether the UK has recovered post-Covid, and it appears the answer depends on what metrics you use to assess it. (I do note, incidentally, that the Covid pandemic is not officially over, and so it may be a little early for these articles).

However, regardless of what the statistics might say, where the economy is likely to be in 12 months or so is, in my opinion, defined far more by the attitudes of businesses and consumers today. Are they confident? Do they feel money burning a hole in their pocket or do they want to squirrel more aside against a rainy day.

The impact of the official statistics on this confidence is interesting as there are two sides to it. Taking, say, inflation, an individual is exposed to it in two ways - both directly, as they perceive prices going up, and indirectly as they read about it in the news. I suspect the second has more impact than the first - not many of us can intuitively tell whether average prices are rising by 2% of 5% a year, but we all internalise the media headlines that current inflation is high.

Business confidence from recent surveys (e.g. ICAEW Q3 BCM) shows that confidence is high, and my experience with clients supports that - a lot of businesses feel the outlook is strong from here, and are investing to be in a good place to capitalise on growth. Regardless of what the official statistics say, I expect this confidence to be a self fulfilling prophecy.