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UK economic growth, January 2024

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UK GDP growth in January 'not a hugely positive picture' but it's progress, economist says

LONDON — U.K. gross domestic product grew 0.2% in January, the Office for National Statistics said Wednesday, as construction output jumped more than expected.

The headline figure was in line with the forecast from economists polled by Reuters.

It follows a 0.1% contraction in December, while the U.K. economy entered a shallow recession in the second half of last year.

Construction output rebounded from contraction to grow 1.1% in January, the ONS said, but fell 0.9% over a three-month period. The U.K.’s dominant services sector recorded a 0.2% rise in January, providing the biggest contribution to growth, as production output fell 0.2%.

Despite recording monthly growth, GDP was estimated to have shrunk 0.3% compared with a year ago in January, and fallen 0.1% over the three months to January 2024.

UK budget announcement is 'careful and thoughtful,' ex-finance minister says

Jack Meaning, chief U.K. economist at Barclays, described the figures as “not a hugely positive picture, but it’s ahead of where we were at the end of last year.”

“Industrial and manufacturing have been weak for the last few prints, you’d expect some bounce-back from that in the end,” Meaning told CNBC’s “Squawk Box Europe” Wednesday.

“This is good to see, but we’ll have to see it on a more prolonged basis to know that it is something sustained.”

The latest figures are consistent with a forecast for a “gradual recovery in activity” in the coming months, said James Smith, developed markets economist at ING.

“We think the decline in overall fourth quarter GDP, which marked the second consecutive quarter of negative growth and therefore a technical recession, is unlikely to be repeated in the first quarter of 2024,” Smith said in a note.

The British pound was slightly lower against the U.S. dollar and the euro following the release.

Economics

American cities are criminalising homelessness. Will that help?

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DAVINA VALENZUELA watches as sanitation workers heave most of her belongings into a garbage truck. The 33-year-old has been homeless for more than a year, and was sleeping in a dusty alley in central Fresno, the biggest city in California’s Central Valley. The truck devours bags of clothes, a stroller, a pile of hypodermic needles and around $120—much of it in change. Police officers arrest her and a friend and sit them in the back of a truck. They are given tickets for camping in a public place, which became a misdemeanour crime in September in an attempt to shrink the city’s homeless encampments. “That’s all I have right there,” she says, once her handcuffs are taken off. “I don’t know how I ended up here.”

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Economics

Pete Hegseth is purging both weapons and generals

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THE PENTAGON has been mired in chaos in recent months. Pete Hegseth, the secretary of defence, stands accused of mishandling classified information. Many of his aides have been let go over alleged leaks (accusations they deny). Top generals have been fired for no discernible reason beyond their colour or sex. The department is in “a full-blown meltdown”, says John Ullyot, a Hegseth loyalist who served as chief spokesman until April. Yet Mr Hegseth is pressing ahead with sweeping reforms that will change the size, shape and purpose of America’s armed forces.

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Economics

Where the Trump administration has science on its side  

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BACK IN JANUARY Donald Trump signed executive order 14187, entitled “Protecting Children from Chemical and Surgical Mutilation”. He instructed federally run insurance programmes to exclude coverage of treatment related to gender transition for minors. The order aimed to stop institutions that receive federal grants from providing such treatments as well. Mr Trump also commissioned the Department of Health and Human Services (HHS) to publish, within 90 days, a review of literature on best practices regarding “identity-based confusion” among children. The ban on federal funding was later blocked by a judge, but the review was published on May 1st.

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