UK Economics Too soon to conclude inflation won’t become more persistent It’s too soon to conclude that the weak tone of this week’s news on activity means that inflation won’t become more persistent. Our proprietary measure of underlying/persistent CPI inflation rose to a... 24th June 2022 · 5 mins read
UK Economics Retail Sales (May) The fall in retail sales in May suggests that the decline in households’ real incomes from surging inflation is starting to hit consumer spending a bit harder. Even so, consumer spending appears to be... 24th June 2022 · 3 mins read
UK Economics S&P Global/CIPS Flash PMIs (Jun.) The fact that the composite PMI didn’t fall in June means the economy could be holding up a little better than we and the Bank of England had feared. Beneath the headline numbers, the survey also... 23rd June 2022 · 3 mins read
UK Economics Public Finances (May) The larger-than-expected rise in public borrowing in May is an early blow for the government on a day when it is expected to lose two by-elections. What’s more, the combination of a further weakening... 23rd June 2022 · 3 mins read
UK Economics Consumer Prices (May) The further rise in CPI inflation from 9.0% in April to a new 40-year high of 9.1% in May won’t prevent the Bank of England from raising interest rates further, but it may encourage it to opt again... 22nd June 2022 · 3 mins read
UK Economics Jubilee bank holiday makes life hard for the Bank of England By cutting GDP growth by about 0.3-0.4 percentage points (ppts) in Q2 and raising GDP growth by a similar amount in Q3, the impact of the extra bank holiday to mark the Queen’s Platinum Jubilee will... 21st June 2022 · 4 mins read
UK Economics BoE falling behind the Fed, but hints it may speed up By raising interest rates by 25bps (basis points) today, from 1.00% to 1.25%, rather than by 50bps or the 75bps the Fed announced last night, we think the Bank of England is putting too much weight on... 16th June 2022 · 3 mins read
UK Economics Labour Market (Apr./May) The tentative evidence that the recent weakening in economic activity is filtering through into a slightly looser labour market may push the Bank of England a little closer to raising interest rates... 14th June 2022 · 3 mins read
UK Economics GDP (Apr.) The 0.3% m/m fall in real GDP in April wasn’t as weak as it looks, but it nonetheless increases the chances that the economy is slipping into recession. While this is unlikely to prevent the Bank of... 13th June 2022 · 4 mins read
UK Economics Boris using the economy to fight back, BoE to hike by 50bps By deploying economic policies and Brexit battles in the fight for his political life, Boris Johnson is inadvertently asking the Bank of England to work harder to quash inflation. As it happens, we... 10th June 2022 · 9 mins read
UK Economics Joining the 50bps club The further tightening in the labour market, the additional loosening in fiscal policy and more evidence that the weaker activity outlook is not reducing price and wage expectations lead us to believe... 9th June 2022 · 10 mins read
UK Economics Activity holding up and price pressures strengthening Real economic growth is slowing rather than collapsing in the face of the twin drags of higher inflation and rising interest rates. The Chancellor’s latest fiscal handout will help support GDP in the... 8th June 2022 · 9 mins read
UK Economics Risks to consumer spending forecast tilted to the downside April's money and credit data provide another reason to think that the consumer slowdown in April wasn't too severe. But it may take time for the cost of living squeeze to fully filter through into... 1st June 2022 · 3 mins read
UK Economics Money & Credit (Apr.) The solid rise in unsecured borrowing in April suggests that households have turned to credit to support their spending as the cost of living squeeze has intensified. But consumers do not yet appear... 31st May 2022 · 3 mins read
UK Economics What the Chancellor gives, the BoE will have to take away The new fiscal stimulus announced by the Chancellor this week puts more pressure on the Bank of England to raise interest rates into restrictive territory. As result of this and other recent... 27th May 2022 · 4 mins read
UK Economics Chancellor supports household incomes, but boosts inflation The extra financial support for households announced by the Chancellor today will help millions of households cope better with the cost of living crisis. But it won’t relieve all the pain and may mean... 26th May 2022 · 3 mins read