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Report
from the UK
OECD warns of slowing UK economic growth
Organization for Economic Cooperation and Development’s (OECD) announced that the UK would
need to cut interest rates to boost the economy, said the BBC. It warned that that the slowing economy
could increase the UK’s budget deficit and lead to spending cuts. The OECD forecast that economic
growth in the UK could be below 2.5% and suggested that the credit turmoil could
affect the high street and housing markets.
Housing market shrugs off financial turbulence
Nationwide reported that despite recent turbulence in financial markets, housing prices have risen 0.7% in
September. However, it noted that the annual price growth slowed to 9%, its lowest in a year. The
Institute of Chartered Surveyors said there is a one in ten chance of a 1990s style housing market crash.
BBC also reported on UK housebuilder Barrett Developments similar statement on the housing market,
which warned that interest rates and the credit crunch would hit housing markets. However, it noted that its long
term outlook was positive.
Optimism of UK timber traders waning
The TTJ recently explained the impacts of the CBI polls from July. It reported that UK timber and wood product
suppliers’ attitude recently weakened toward the general business situation. It noted that
businesses working below capacity had fallen to 56%, but that orders have shrunk
relative to normal levels. The outlook for orders is expected to be flat in the coming months, as is the outlook
for manufacturing costs and factory prices of timber and related products.
EUROPE
MARKET and Scandinavia
German
timber industry sales jump 9.5%
The German timber industry reported sales increases of 9.5% (EUR18.94
billion), said EUWID. President of the German Association of Wood Working
and Plastics Industries (HDH), Dirk-Uwe Klass, announced the results
during the association’s annual press conference in Cologne on 30
August. Despite the overall rise in sales, the timber industry had to
overcome slow domestic order inflows. Klass said the jump in sales were
mainly due to prices for exports and price increases in the furniture
sector. Companies that were associated with the building sector fared
better in the first quarter than the second
quarter, since there was reduced investment in residential building during
the second quarter.
Sales rose for veneers, plywood, wood fiberboard and particleboard by
17.2% in the first half of the year.
Excluding furniture, the association expects a 9% rise in sales to
EUR19.billion for the year 2007. This would mean that the second half of
the year would experience a slow down in sales, due to the decline in
building activity. Nevertheless, furniture sales are expected to grow 5%
in 2007.
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