This week we saw positive signs that the ease in coronavirus lockdown rules in the UK were starting to reduce strains on the economy. Retail figures showed a jump in sales of 14%, far higher than the 8% analysts were expecting. While this is good news, it is far from a complete recovery. Retail sales only makes up around a third of consumer spending normally, so there may be a transfer from services while things like restaurants remained closed. This could explain the slowdown in GDP growth, which stalled over the period.
Elsewhere tensions between the US and China continued to escalate, with the UK stuck in the middle. Post Brexit, the UK will want stronger trade relations with both countries but is increasingly being asked to pick sides. Mike Pompeo, US Secretary of State, flew to Britain to recruit for team USA and gave a speech some observers claim amounted to a declaration of a new cold war. The UK has received large inflows of Chinese cash and China owns significant stakes in most sectors of the economy, including the railways, telecoms network, nuclear power plants and North Sea oil.
Read what the team at FE consider to be significant over the current week.