London Monitor | The July ‘ pingdemic ’ did not derail London economic expansion
Although the ‘ pingdemic ’ in July raised concerns about the UK economic recovery, the evidence is that activity has continued to expand, even if the biggest post lockdown gains are now behind us. Survey evidence suggests that business activity was robust in London during July. Although the pace of expansion slowed from June, according to the Purchasing Managers’ Index , London output growth remained strong by historical standards.
What you will learn:
- Among specific sectors, construction rebounded in Q2, with spending in London up 11% from Q1 and driven by new investments.
- The first signs of meaningful recovery have been seen in the
tourism sector, with hotel occupancy up 10 points to 41%.
- Demand has continued to rise in the labour market, with Labour Force Survey data showing a quarterly rise of 0.2 points in London’s resident employment rate to 74.7% in Q2.
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Households' financial surpluses sharply increased in 2020 and remained high in 2021 due to the Covid pandemic. Most of the surplus continued to go to cash and deposits, but there was a notable increase in funds going to investment trusts (with a large portion invested in foreign equities) in 2021. Amid rising international yield differentials and a weakening yen, there is market chatter about whether this is the beginning of a structural shift from households' risk-averse investment style?Find Out More