The Monday note - 26 February 2018

• The FTSE 100 closed at 7,244.4 on Friday, down 50 points from Monday’s open, as investors digested mixed news on the economy. The ten year Gilt yield stood at 1.55%. 
• The second reading saw UK GDP growth in Q4 2017 revised down from 0.5% to 0.4%, due to weaker than assumed industrial production. This was partly due to an oil pipeline shutdown in the North Sea. 
• UK productivity grew at its strongest pace since the financial crisis, as output per hour rose by 0.8% in Q4 2017. 
• BlackRock plans to establish an artificial intelligence research centre in California’s Silicon Valley. The asset manager wants to develop machine learning to support investment decisions and automate processes.

Chief Economist comments: 

Prime Minister Benjamin Disraeli famously said: “there are three types of lies – lies, damn lies, and statistics”. Last week saw the UK GDP figures revised down, which on the face of it seems to suggest the economy was weaker than originally thought. Well, not exactly. There was a crack in a pipeline running out to the North Sea oil fields, which had to be shut down for repair. This caused a small downwards revision in one figure, which resulted in another figure being rounded downwards instead of upwards. So on the official spreadsheets GDP growth was revised down, although in the real world the economy put in a robust performance in Q4 2017.