UK Economics Focus UK Economics Special - Will the housing downturn derail the economy? The housing market is slowing and, if history is anything to go by, that spells seriously bad news for the UK economy. Each of the three previous major housing downturns since the 1960s has been... 29th September 2004 · 1 min read
UK Economics Focus Are the trade data hiding an improvement? It has been suggested that one reason why the UK’s trade position has failed to improve in response to the global economic recovery is the mismeasurement of trade flows. Indeed, National Statistics... 15th September 2004 · 1 min read
UK Economics Focus Retail sales are just one side of the coin The monthly retail sales numbers attract the most attention as a measure of the strength of household spending. However, they have recently been a far from reliable guide to whether the boom in total... 6th September 2004 · 1 min read
UK Economics Focus Getting a better measure of market rate expectations The most frequently used method of estimating the markets’ expectations for the official interest rate is to derive an implied path from short sterling futures contracts. On the face of it, these... 17th August 2004 · 1 min read
UK Economics Focus Time to start thinking about lower interest rates? With UK interest rates still firmly in the up-phase of the cycle, markets and commentators alike have continued to focus on exactly how far rates are likely to rise. So far, they appear to have given... 9th August 2004 · 1 min read
UK Economics Focus No room for mavericks in Mervyn’s Kingdom? The last year or so has seen an unprecedented degree of unity in the voting behaviour of members of the Monetary Policy Committee. Only once in the last 12 months has the size of the majority slipped... 29th July 2004 · 1 min read
UK Economics Focus Labour market not as tight as it looks? Today’s labour market data revealed a further drop in unemployment, with the claimant count rate, already at a 29 year low, edging down further to just 2.7% in June. As such, concerns are building... 14th July 2004 · 1 min read
UK Economics Focus Time for monetary shock treatment? The failure of the increases in official UK interest rates seen in recent months to have any visible impact on the housing market or the rapid growth of household spending and borrowing suggests that... 22nd June 2004 · 1 min read
UK Economics Focus Is the CPI giving a complacent picture of inflation? The answer is no. Attention tends to focus on CPI, given that it is the measure of inflation targeted by the Monetary Policy Committee. And although yesterday’s data showed that CPI inflation rose to... 16th June 2004 · 1 min read
UK Economics Focus Getting a proper measure of the burden of household debt On the face of it, households are having an easy time servicing their record levels of debt. Interest payments as a percentage of their income (income gearing) are just 7.1%, less than half the 1990... 1st June 2004 · 1 min read
UK Economics Focus MPC’s faith in surveys may prove misplaced The Monetary Policy Committee’s prediction of a very solid 3.5% expansion in GDP this year is based on the assumption that the official output data will soon reflect the buoyancy of the business... 18th May 2004 · 1 min read
UK Economics Focus Oil prices no major threat to UK inflation outlook The recent rise in global oil prices to close to $40pb appears to provide support for the MPC’s concerns that rising commodity prices pose a serious threat to the outlook for UK inflation. But while... 11th May 2004 · 1 min read
UK Economics Focus MEW won’t prevent a household spending slowdown Conventional wisdom has it that mortgage equity withdrawal (MEW), which rose to a record high in the fourth quarter of last year, has provided a strong boost to household spending and will continue to... 26th April 2004 · 1 min read
UK Economics Focus Budget 2004: The great growth gamble goes on Dull though this Budget was, the big surprise was that the Chancellor chose not to raise money but rather to give it away. Admittedly, the amounts are tiny – some £700m, making a net giveaway since... 17th March 2004 · 1 min read
UK Economics Focus Budget 2004 Preview Gordon Brown presents his 8th Budget next Wednesday against a significantly stronger economic backdrop than that of a year ago. Thanks to the recovery in the global economy and some favourable... 9th March 2004 · 1 min read
UK Economics Focus What could the government do to control household debt? The only tool which is currently available to dampen the record levels of household borrowing is the interest rate. But the Monetary Policy Committee has made it clear that its remit is to target... 3rd March 2004 · 1 min read
