UK Economics Update More QE still in prospect Although the MPC left its quantitative easing (QE) programme on pause again at today’s meeting, we think that more asset purchases are likely before long. And yesterday’s gloomy Autumn Statement... 6th December 2012 · 1 min read
UK Economics Update Household Borrowing Monitor (Oct.) Household borrowing growth remains pretty weak, although there are tentative signs that the Bank of England’s Funding for Lending Scheme (FLS) is starting to have a positive impact. 29th November 2012 · 1 min read
UK Economics Update Monetary Indicators Monitor (Nov.) The broad money supply is continuing to grow at a decent pace. But there are question marks over whether that will last now that the MPC has paused its quantitative easing (QE) programme and whether... 29th November 2012 · 1 min read
UK Economics Update Are the one-offs boosting inflation really one-offs? The Bank of England continues to argue that inflation is being kept high by a series of one-off factors. Many of the “idiosyncratic” factors boosting inflation at the moment may prove to be more than... 28th November 2012 · 1 min read
UK Economics Update A sustained recovery in spending not underway yet While real household spending posted a decent rise in the third quarter, at least half of the increase was due to the Olympics. And with the fourth quarter shaping up to be weak, a sustained recovery... 27th November 2012 · 1 min read
UK Economics Update Governor Carney will face new challenges Bank of Canada Governor Mark Carney is well-qualified to manage the Bank of England’s expanded role when he takes over from Mervyn King as Governor of the Bank of England at the end of next June... 26th November 2012 · 1 min read
UK Economics Update Big challenges ahead for whoever is Governor It should not be long until we hear who will replace Sir Mervyn King as Governor of the Bank of England at the end of next June. It is thought that the appointment of a Bank “insider” might just lead... 21st November 2012 · 1 min read
UK Economics Update Will Christmas on the high street be a wash-out? October’s poor retail sales figures have prompted fears of a disappointing Christmas on the high street. While we doubt that it will be a write-off, we expect consumers to be cautious and retailers... 16th November 2012 · 1 min read
UK Economics Update Is monetary policy reaching its limits? Some members of the MPC appear to think that they are reaching the limits of how much monetary policy can help the economy. We agree that more gilt purchases might not do a lot of good. But this just... 12th November 2012 · 1 min read
UK Economics Update Osborne’s windfall doesn’t change big picture The Government today agreed with the Bank of England to transfer to the Exchequer the excess cash held in the Bank’s quantitative easing (QE) facility. This will leave the published borrowing figures... 9th November 2012 · 1 min read
UK Economics Update Would missing the debt rule lose the UK its AAA rating? The European Commission this week added to warnings that the Chancellor might miss his target for debt as a share of GDP to be falling in 2015/16. One factor influencing whether Mr Osborne decides... 8th November 2012 · 1 min read
UK Economics Update MPC not out of firepower yet The MPC’s decision to leave policy on hold today would not have been an easy one and the vote could have been quite close. We think that more policy stimulus will be required in the coming months –... 8th November 2012 · 1 min read
UK Economics Update Child benefit cuts only part of accelerating fiscal squeeze About 1 million households are currently receiving a letter from HMRC setting out how much they will lose from child benefit reforms taking effect in January 2013. While the macroeconomic impact of... 7th November 2012 · 1 min read
UK Economics Update PPI payments still not a game-changer for spending outlook UK banks have now increased their provisions for compensation payments for mis-sold Payment Protection Insurance (PPI) policies to £15bn – equal to 1.5% of annual household incomes. However, we think... 5th November 2012 · 1 min read
UK Economics Update Funding for Lending Scheme - a double-edged sword? September’s relatively positive borrowing numbers provided tentative evidence that the Bank of England’s Funding for Lending Scheme (FLS) is reducing the cost and increasing the availability of credit... 30th October 2012 · 1 min read
UK Economics Update Household Borrowing Monitor (Sep.) The latest household borrowing indicators seemed to reinforce the positive news from last week’s GDP data. But in the face of continued declines in real pay, a pick-up in borrowing may be a symptom of... 29th October 2012 · 1 min read
