Data released this morning by the CSO stated that gross domestic product (GDP) in the third quarter of 2014 accelerated by 3.5 per cent year-on-year while gross national product (GNP) grew by 2.5 per cent. This growth rate has been driven by strong uplifts in trade performance and domestic demand. Whilst there has been only a modest increase in consumer spending up 1.2%, the bulk of this growth can be attributed to Investment spending up by 11.3%. This is mainly in part to the lively expansion of multinational activity.
Unemployment has fallen from 12.1% at the start of the year to 10.7% by November. The recovery in consumer spending and unemployment figures has resulted in a knock on effect with increases in Income Tax and Vat Receipts, tax revenues are up 8.5% on last year.


The bull market continues with global equities rising for the tenth straight month. Markets were buoyed by positive third quarter earnings reports emanating from the US, along with quantitative easing expansion in Japan. In Europe Mario Draghi has continued his trend by strengthening the pledge of a continuing stimulus package for the EU.
World equities rose by 2.3% for the month of November, resulting in a total return of 18% year to date. Growth rates geographically for November were as follows, European markets grew by 4.6%, US markets were up 2.5% and Japanese markets led by expanding 5.8%, attributable to the monetary expansion in QE.


All of the Eurozone markets were up based on deflationary concerns and the speculation on the introduction of some kind of quantitative easing. German 10-year bond yield fell further in November from 0.84% to 0.70%, this is now at an time low. Equivalent US rates fell from 2.34% to 2.16% during November.
The Federal Reserve and the Bank of England are now expected to keep interest rates at record low levels until third quarter of 2015. The ECB is likely to begin QE in the first quarter of 2015 with President Mario Draghi indirectly saying that the ECB Council was willing to outvote the German Bundesbank on the matter.


1. The big talking point has been oil with European prices down by 18% standing at $70 per barrel, US prices were down similarly by 18% at $66 per barrel. This has caused commodity prices as a whole to be down by 6%, this is on the back of six months of consistent losses. Oil prices continuing to fall is driven in part by Saudi Arabia maintaining supply at high levels. A reduction in Geopolitical risks in the Ukraine and Iraq have also had a knock on effect. The upside of this is lower oil prices result in a tax cut for consumers via lower prices at the petrol pump: the 36% decline in oil costs since June means the global economy might now save US$2.0bn a day in fuel costs. This in turn should boost GDP in developed countries however it will add to disinflationary pressures.

2. Gold prices were up marginally in November, ending at $1,175 per troy ounce. Gold had reached an all-time high of $1,889 in August 2011.

3. After a long period of weakness, the euro currency was flat to stronger against a number of other major currencies during November. The €/$ rate was unchanged at 1.25 at month end.