UK Economics Focus Could the recovery cope with a rate rise? There seems to be an assumption that a modest rise in interest rates, of say 25bps or 50bps, would be relatively harmless for the real economy. But we think that even a minor policy tightening could... 30th March 2011 · 1 min read
UK Economics Focus Budget 2011: Still banking on Plan A The Budget was a fairly cautious affair, with the Chancellor introducing a fiscally neutral package of measures and hence sticking closely to the existing austerity plans. Nonetheless, the Government... 23rd March 2011 · 1 min read
UK Economics Focus Budget 2011 Preview The Budget on March 23rd will probably include some minor measures to ease concerns over the economy and sky-high oil prices. But the Coalition Government is not likely to signal any significant... 15th March 2011 · 1 min read
UK Economics Focus Keeping an eye on the 2011 pay round This Focus sets out the key pay settlements which are likely to be concluded in the coming months. A number of settlements have already been concluded this year and data provider IDS has reported that... 3rd March 2011 · 1 min read
UK Economics Focus Can the resilience of corporate profits last? Corporate profits held up remarkably well during the recent economic downturn. But a closer look at the factors that explain this resilience suggests that profits over the next couple of years are... 14th February 2011 · 1 min read
UK Economics Focus Is GDP higher than we think? A number of puzzles in the UK economy would be resolved if it turned out that GDP has been higher over the past couple of years than the official figures suggest. However, the evidence – while not... 2nd February 2011 · 1 min read
UK Economics Focus Is the housing market heading for a double-dip? Low interest rates alone will not prevent the recent falls in house prices from being extended, perhaps significantly this year. Rather, we expect that the benefits of low interest rates will be... 28th January 2011 · 1 min read
UK Economics Focus Will inflation ever fall back? The stubbornness of UK inflation has prompted suggestions that there has been an adverse shift in the relationship between growth and inflation and has raised concerns that the low inflation... 26th January 2011 · 1 min read
UK Economics Focus Can the economy continue to recover? While we expect the economy to keep expanding, we doubt that the recovery is on the sustainable footing required for it to maintain its recent pace. We expect the combination of the fiscal squeeze... 24th January 2011 · 1 min read
UK Economics Focus Housing downturn another blow for consumer spending The dominant themes of this Statement come not from the Chancellor but from the OBR. It now paints a pretty gloomy picture of the immediate economic outlook. Even so, we think its forecasts are not... 30th November 2010 · 1 min read
UK Economics Focus Can the spending cuts actually be achieved? The sheer size of the Government’s planned reductions in public spending and the likely weakness of the economy cast major doubts on whether the cuts can actually be achieved in full. But big cuts are... 14th October 2010 · 1 min read
UK Economics Focus Will tighter regulation prevent a recovery in lending? The changes in the regulatory regime currently being decided are unlikely to be the key determinant of banks lending behaviour in the near-term. But tighter regulation threatens to choke off any... 13th September 2010 · 1 min read
UK Economics Focus Is QE finally working? The MPCs preferred measure of the money supply has recently started to grow at the rates the Committee was aiming for when it began its policy of quantitative easing (QE). However, we would be wary of... 17th August 2010 · 1 min read
UK Economics Focus Fiscal squeeze to slam the brakes on consumer spending We expect the fiscal tightening to leave real household disposable incomes falling by 1% next year and stagnating in 2012 the tightest squeeze since the mid-1970s. As a result, we no longer expect... 21st July 2010 · 1 min read
UK Economics Focus Policy challenges for the new Government The new coalition Government has made an industrious start. But it still faces some major policy challenges if it is to achieve the multiple goals of sorting out the public finances, improving... 15th July 2010 · 1 min read
UK Economics Focus Policy challenges for the new UK Government The new coalition Government has made an industrious start. But it still faces some major policy challenges if it is to achieve the multiple goals of sorting out the public finances, improving... 15th July 2010 · 1 min read
