UK Economics Focus Manufacturing is not an island Consensus forecasts that the economy will grow in line with its long run average rate this year appear to be based upon two key conditions: First, that the slowdown on the industrial side of the... 24th July 2001 · 1 min read
UK Economics Focus Oil price fall to take ¼% off inflation Oil prices have fallen through $24 per barrel for the first time since early April on signs of both weaker demand in response to the economic slowdown and increased supply as Iraq has resumed... 12th July 2001 · 1 min read
UK Economics Focus The Mansion House Speech & the Euro Last night’s Mansion House Speech by Gordon Brown seems to have put paid to recent speculation of an early assessment of the five economic tests leading to a euro referendum as soon as this Autumn... 21st June 2001 · 1 min read
UK Economics Focus Inflation & Interest Rates – Sticking to our Guns A succession of stronger economic data releases, coupled with speculation of early entry into the single currency, has prompted a dramatic shift in the markets’ expectations of the future path of... 13th June 2001 · 1 min read
UK Economics Focus A Wolf in Sheep’s Clothing? Key policy issues in Labour’s second term Markets and business have approached the prospect of a second Labour term in Government in relaxed mood. This no doubt reflects the generally market friendly policies of the first term, coupled with... 8th June 2001 · 1 min read
UK Economics Focus Forecast change: 4.5% interest rates by year-end Clients of Capital Economics will know that we have been well ahead of consensus forecasts in predicting lower official interest rates in the UK this year. We first forecast that the Bank of England’s... 10th May 2001 · 1 min read
UK Economics Focus Windfalls – what happened last time? Three previously mutually owned organisations – Friends Provident, Scottish Provident, and Scottish Life – have announced that, subject to members’ approval, they are to lose their mutual status... 4th May 2001 · 1 min read
UK Economics Focus Foot & Mouth – The Economic Impact Around 8% of the UK’s total livestock has already been destroyed as a result of the foot and mouth outbreak. However, the ultimate impact on output in the livestock sector will be proportionately much... 4th May 2001 · 1 min read
UK Economics Focus Another 1% to Come Today’s ¼ point cut in base rates is proof that, for all the indications that the fundamentals of the UK economy remain in good shape, the MPC is fully aware of the potential impact that a rapid... 5th April 2001 · 1 min read
UK Economics Focus Rates to fall amidst risks to confidence I believe that the MPC will cut interest rates by 0.25% on Thursday, although, unlike in February, it may not be a unanimous decision. 2nd April 2001 · 1 min read
UK Economics Focus Inflation is in the Eye of the Beholder The official target measure of inflation, RPIX, is not only running well below target, but is probably seriously exaggerating true inflationary pressures. 7th March 2001 · 1 min read
UK Economics Focus Budget Assessment 2001 – Cautious to a Fault This is a much tighter budget than financial markets might have feared from a Chancellor awash with cash and soon to face an election. A great deal of sound and fury was made about many measures to... 7th March 2001 · 1 min read
UK Economics Focus Foot & Mouth – The Economic Effects Agriculture accounts for 2% of GDP while the livestock sector is probably 1% or less. Accordingly, a 10% reduction in livestock output would reduce GDP by 0.1% for as long as it lasts. This accords... 1st March 2001 · 1 min read
UK Economics Focus Budget 2001 Preview Although the backdrop to the Budget of an excellent fiscal position and a strong economy is a familiar one, there are some key differences from previous years. The general election is just months away... 22nd February 2001 · 1 min read
UK Economics Focus Pre-Budget Report 2000 The package of policy measures announced in the Pre-Budget Report was more generous than generally expected. The loss of revenues due to the freeze in fuel duties and the extra spending on pensions... 8th November 2000 · 1 min read
