Don’t be gloomy about the economy — it could be much worse

 (Shutterstock / IR Stone)
(Shutterstock / IR Stone)

On the face of it, today’s economic statistics aren’t exactly encouraging.

House prices have seen the biggest fall since 2009 and economic growth is at as near zero as makes no difference.

But there’s another way of looking at it. On house prices, perhaps what we are seeing here is the froth coming off a fairly extraordinary pandemic related boom. That period when our homes were the only places we were allowed to go inevitably saw them valued higher.

A correction downwards seems normal and if it does something to relax our national obsession with how much our bricks and mortar are worth perhaps that is healthy.

Today’s slight upward revision to GDP growth in the third and fourth quarters of last year suggests that inflation, torrid though it is, took a somewhat smaller toll on the economy than expected.

Perhaps UK households are more resilient and better prepared for economic shocks than the worst headlines indicated. And we have just signed a trade pact with 11 Asian and Pacific nations which might not mean much for growth in the short-term, but surely bodes well for the future.

In other news, the Lloyds Bank business barometer shows that business confidence is at a 10-month high. And fears that we were heading towards another banking crisis are receding. Stock markets are heading back up. We avoided a recession last year and might well do so this year too.

When you consider everything the economy has been through, that really isn’t such a bad result.

It could have been much worse.