Even the good times are bad

I haven't had a rant about the misleadingly gloomy tone of business reporting in the UK for quite a while. Time to remedy that.

Yesterday the British Retail Consortium (BRC) published its report on High Street spending for January.  Press reports on the data today include: "gloomy figures" and "a bunker mentality" (The Times); "drop in sales" (The Guardian); and "shoppers cut back" (Daily Telegraph).

The numbers must have been pretty bad, right? They couldn't all have got it wrong, could they?  Well actually, yes they could. The BRC's report actually showed that overall retail spending in January was up 2.1% from the year before. As usual the BRC chose to emphasise the "like-for-like sales" data, which were marginally lower, even though this is a meaningless number. (It only includes sale from stores open for at least a year.  This means that it excludes the massive Westfields shopping centre near the Olympic Park, which opened to such fanfare just ahead of the Christmas shopping season!)  The BRC's spin was enough to bamboozle both the Telegraph and the Guardian, with the latter not even finding space to report the overall 2.1% increase.

The Times did a bit better, correctly reporting the overall 2.1% increase, but still imparting a negative tone: this was, according to the BRC, the second worst January increase since the survey began 17 years ago. Still and all, it was an increase, and it would be entirely true to report that the value of UK retail sales last month was the highest for any January in history, although neither the BRC nor the media seemed to think that was worth saying.

Retail sales are not the only UK indicators that are doing just a bit better than some, or rather most, of the reportage might lead you to believe. Car sales rose in January (albeit by a nugatory 0.03% year-on-year); consumer confidence has edged higher; and both manufacturing and services surveys are showing a modest increase in sentiment. With the Eurozone crisis still rumbling along, it's too soon to break out the prosecco, and it may well be that the Bank of England will see fit to carry out a third round of quantitative easing later this week. Even so, a return to recession is far from certain, and as inflation continues to decelerate, there could even be some pickup in the pace of the recovery by mid-year. Just don't look for it in the business pages.