James Moore: A happy new year? Third helping of recession is starting to look more likely

Outlook Remember when everyone was twitching about a double dip recession? Those seem like halcyon days now that there's a new phrase creeping its way into the popular lexicon: The triple dip.

The latest figures from the Office for National Statistics confirmed that the economy did indeed grow 1 per cent in the third quarter of this year, its best performance for a long time.

But the figure is a mirage. Growth between July and September was greatly boosted by one-off events such as the Queen's Jubilee and the Olympics. In their absence, a fall back to more realistic levels by the end of the current quarter was inevitable.

However, that fall may be steeper than we realise. Already there are disturbing signs that activity is slowing by more than can be accounted for by a post-Olympic drop-off.

The floods across the large parts of the country combined with widespread uncertainty and wafer-thin confidence mean the festive season will be a subdued one. If the economy isn't contracting now, it might not be too long before it is.

To qualify as a recession – our triple dip – there would need to be two consecutive quarters of negative growth. That may not happen but it is a realistic possibility.

Mark Carney was always going to find himself in a hot seat following his appointment as Governor of the Bank of England on Monday. He is about to find out just how hot.

There are things the government could do to help the situation. As if we needed any more gloom, the OECD yesterday warned that Britain's public finances will be in pretty poor shape throughout next year.

But, crucially, it again stated that Britain might want to consider easing up on its ambitious targets to cut the budget deficit at least until the economy is healthier.

That would be the pragmatic option, and the sensible one. It's true we might get downgraded by Moody's or Standard & Poor's but, really, who cares? It is a long time since those organisations had any clout with the bond markets which dictate our borrowing costs.

Sadly, sense is a commodity that is in short supply in Westminster. Against the backdrop laid bare by the OECD, the Government is contemplating yet more spending cuts which increasingly seem driven by ideology as opposed to sound economics.

All that and the potential of internecine warfare with our nearest trading partners to protect the Conservative Party's rightward flank from a surging UK Independence Party. Best wait until 2014 before saying "happy new year".

PROMOTED VIDEO
News
ebooksNow available in paperback
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Selby Jennings: Business Development Manager – Frankfurt – Asset Manager

Negotiable: Selby Jennings: Business Development Manager – Frankfurt – Asset M...

Selby Jennings: Leveraged Finance - Senior Associate - International Bank - Frankfurt

Competitive + bonus: Selby Jennings: My client, a growing European CIB are loo...

Reach Volunteering: Trustee – PR& Marketing, Social Care, Commercial skills

Voluntary Only - Expenses Reimbursed: Reach Volunteering: Age Concern Slough a...

Reach Volunteering: Charity Treasurer

Voluntary Only - Expenses Reimbursed: Reach Volunteering: Crossroads Care is s...

Day In a Page

In a world of Saudi bullying, right-wing Israeli ministers and the twilight of Obama, Iran is looking like a possible policeman of the Gulf

Iran is shifting from pariah to possible future policeman of the Gulf

Robert Fisk on our crisis with Iran
The young are the new poor: A third of young people pushed into poverty

The young are the new poor

Sharp increase in the number of under-25s living in poverty
Greens on the march: ‘We could be on the edge of something very big’

Greens on the march

‘We could be on the edge of something very big’
Revealed: the case against Bill Cosby - through the stories of his accusers

Revealed: the case against Bill Cosby

Through the stories of his accusers
Why are words like 'mongol' and 'mongoloid' still bandied about as insults?

The Meaning of Mongol

Why are the words 'mongol' and 'mongoloid' still bandied about as insults?
Mau Mau uprising: Kenyans still waiting for justice join class action over Britain's role in the emergency

Kenyans still waiting for justice over Mau Mau uprising

Thousands join class action over Britain's role in the emergency
Isis in Iraq: The trauma of the last six months has overwhelmed the remaining Christians in the country

The last Christians in Iraq

After 2,000 years, a community will try anything – including pretending to convert to Islam – to avoid losing everything, says Patrick Cockburn
Black Friday: Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

Britain braced for Black Friday
Bill Cosby's persona goes from America's dad to date-rape drugs

From America's dad to date-rape drugs

Stories of Bill Cosby's alleged sexual assaults may have circulated widely in Hollywood, but they came as a shock to fans, says Rupert Cornwell
Clare Balding: 'Women's sport is kicking off at last'

Clare Balding: 'Women's sport is kicking off at last'

As fans flock to see England women's Wembley debut against Germany, the TV presenter on an exciting 'sea change'
Oh come, all ye multi-faithful: The Christmas jumper is in fashion, but should you wear your religion on your sleeve?

Oh come, all ye multi-faithful

The Christmas jumper is in fashion, but should you wear your religion on your sleeve?
Dr Charles Heatley: The GP off to do battle in the war against Ebola

The GP off to do battle in the war against Ebola

Dr Charles Heatley on joining the NHS volunteers' team bound for Sierra Leone
Flogging vlogging: First video bloggers conquered YouTube. Now they want us to buy their books

Flogging vlogging

First video bloggers conquered YouTube. Now they want us to buy their books
Saturday Night Live vs The Daily Show: US channels wage comedy star wars

Saturday Night Live vs The Daily Show

US channels wage comedy star wars
When is a wine made in Piedmont not a Piemonte wine? When EU rules make Italian vineyards invisible

When is a wine made in Piedmont not a Piemonte wine?

When EU rules make Italian vineyards invisible