UK Economics Update BoE talks a good hawkish game, but is unlikely to deliver The Bank of England’s repeated pledge that it is “ready to act as necessary” (i.e. hike interest rates), alongside its decision to keep rates unchanged at 3.75%, was no surprise. But provided the US... 18th June 2026 · 3 mins read
UK Economics Update How will the UK government raise defence spending? An increase in defence spending could represent a significant source of extra demand in the UK. But the UK’s weak fiscal position suggests higher defence spending will need to be mostly funded by tax... 26th May 2026 · 6 mins read
Commodities Update Seasonal dynamics to support natural gas prices in H2 The fact that Asian buyers of LNG from the Middle East have so far curtailed demand has helped to limit the upward pressure on natural gas prices. But even if the Strait of Hormuz reopens soon, a... 19th May 2026 · 4 mins read
Global Economics Update Assessing the effects of an extreme war scenario In this Update, we explore an extreme scenario in which the Iran war escalates beyond the assumptions in our published baseline and adverse scenarios. With Brent crude jumping higher and staying at... 14th May 2026 · 7 mins read
UK Economics Update What would a new PM mean for the UK economy and markets? With Starmer’s premiership looking on the precipice, we are resending this analysis we published on Friday 8th May that highlights the main policies of his potential replacements and what they might... 8th May 2026 · 10 mins read
UK Economics Update BoE on hold for now, but rate hike risks are rising The Bank of England’s further hawkish tilt while leaving interest rates unchanged at 3.75% suggests the chances of near-term rate hikes are rising. If oil prices fall back to about $95pb as in our... 30th April 2026 · 3 mins read
UK Economics Update Upside risks to our forecast for household bank deposits to ease Given the fall in households’ real incomes will mean households have less cash to save, we expect the monthly flow into bank deposits to ease in our baseline scenario. But if we are wrong, it is... 29th April 2026 · 3 mins read
Capital Daily Reopening of Strait leaves us close to our baseline scenario The announcement that the Strait of Hormuz will be reopened has extended this month's dual rally in stocks and bonds. We think both rallies have further to run if things progress broadly in line with... 17th April 2026 · 4 mins read
UK Economics Update Iran war to boost UK prices for flights, flowers and food Outside of fuel and utilities, the prices of flights, other forms of transport, flowers and food are likely to rise the most in response to the Iran war. In our baseline scenario, food price inflation... 16th April 2026 · 5 mins read
UK Economics Update What does the Iran war mean for UK loan arrears? While higher unemployment and mortgage rates due to the Iran war suggest the share of loans in arrears will rise over the next few years, even in an adverse scenario it will remain low relative to... 16th April 2026 · 4 mins read
Global Economics Update The economic consequences of a tax on Hormuz trade A tax on shipping through the Strait of Hormuz would be unlikely to have major near-term implications for global energy markets, trade or wider economic activity. But depending on how it is structured... 9th April 2026 · 4 mins read
Global Economics Update What are the potential implications of Houthi Attacks? While the direct effect of renewed strikes on shipping in the Red Sea on aggregate world trade is likely to be limited, the impact on Asian economies that rely more heavily on oil imports from Saudi... 31st March 2026 · 4 mins read
Bonds Update Assessing the risks of another Gilt market meltdown Gilts have been under huge pressure since the start of the war in the Middle East and this Update sketches out how much more pressure they might come under if the war were to drag on. 30th March 2026 · 4 mins read
UK Economics Update Bank of England leaning a bit more towards rate hikes rather than cuts While leaving interest rates at 3.75% today as widely expected, the Bank of England suggested it is more concerned about the upsides to inflation from the leap in energy prices triggered by the... 19th March 2026 · 3 mins read
Europe Economics Update Which European countries are most exposed to higher energy prices? The rise in energy prices resulting from the Iran conflict will have an adverse impact on most European economies. In the euro-zone, Germany and Italy are more exposed than France, though Germany has... 17th March 2026 · 2 mins read
UK Economics Update How will the UK government respond to higher energy prices? This has been updated to reflect the latest developments as well as our new Baseline and Adverse scenarios. Even in our adverse scenario, we have assumed the fiscal support for households and... 12th March 2026 · 5 mins read
