Sunak’s summer statement

ON JULY 8TH Rishi Sunak, the chancellor, delivered what the Treasury called a “summer economic update”. Although it was not officially a budget, which would have required new forecasts and policy costings by the Office for Budget Responsibility (OBR), a fiscal watchdog, it felt like one. The chancellor spoke for only half an hour and yet still managed to announce around £30bn ($38bn) in new measures, some 1.4% of pre-crisis GDP, for the current fiscal year—a huge deal, in normal times.

Output, which shrank by around a quarter over the course of March and April, almost certainly began to expand again in May, but the pace and the shape of the recovery remain contentious (see article). Real-time data, which show consumer spending now down by a mere 10% year on year, point to a fairly rapid bounce, but other measures suggest a less rosy outcome. Capital Economics, a consultancy, reckons that the initial bounce-back in activity, as measured by visits to workplaces and shops, has been slower in Britain than in other rich economies. Both the OBR and the Bank of England appear to have been too pessimistic in their respective April and May forecasts on the scale of the plunge but independent forecasters reckon that both were too optimistic about the...