Wednesday, February 17, 2010
Claimant count rise is no double-dip
Posted by David Smith at 10:30 AM
Category: Thoughts and responses

Expect lots of "double-dip" headlines following the 23,500 rise in claimant count unemployment to 1.64 million in January but don't take them too seriously. It was always going to be a miracle to get through January and February without further rises in the claimant count, and the increases this time are a fraction of those a year ago. The weather won't have helped. The wider measure of unemployment, based on the Labour Force Survey, slipped by 3,000 to 2.46 million over the October-December period and the rate remained at 7.8%. The fall in full-time employment, 37,000, was the smallest since the three months to July 2008. There's plenty of slack in the labour market but these figures remain very good. More here.

The Bank of England, meanwhile, had a big debate about quantitative easing (QE) but managed to coalesce around a 9-0 vote in favour of not doing any more for the moment. There were arguments on both sides. Clearly some MPC members are concerned about the headwinds facing the economy while others think the effects of QE on asset prices and the upside risks to inflation were good enough reasons to stop. "Taken together, all members felt that the arguments in favour of leaving the size of the asset purchase programme unchanged at this meeting were more persuasive," the minutes said. "But for some members, the arguments were very finely balanced." More here.