In another sign that most of the world’s largest economies are slowing, and that austerity programs may have taken a toll on growth in the United Kingdom in particular, the Office for National Statistics released weak production and manufacturing data for June. In its press release, the agency reported:
The seasonally adjusted Index of Production fell by 4.3 per cent in June 2012 compared with June 2011
The seasonally adjusted Index of Manufacturing fell by 4.3 per cent in June 2012 compared with June 2011
Production fell by 2.5 per cent between May 2012 and June 2012, with manufacturing falling by 2.9 per cent
Official government figures have shown that the United Kingdom is close to recession, if it has not entered one already. The new data will put more pressure on the government of David Cameron. He has used cost cuts as the primary means to try to close the country’s deficit. That has not worked, many economists say. The U.K. will be the next battleground for the value of stimulus over austerity in turning around the troubled financial fortunes of nations in the region.
Douglas A. McIntyre