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
UK Economics Focus Trend towards self employment to keep a lid on wages growth Wages growth has remained remarkably subdued in recent months, with last month’s data showing annual average earnings growth of just 3.2%. But with the labour market data also showing employment... 3rd February 2004 · 1 min read
UK Economics Focus Which survey should we believe? After flitting in and out of recession for the last five years, the manufacturing sector has seen signs in recent months that conditions are finally improving. In particular, the CIPS Report on... 11th December 2003 · 1 min read
UK Economics Focus Pre-Budget Report 2003 As usual, the Pre-Budget Report contained little in the way of major fiscal measures. Of more interest were the new economic and fiscal forecasts, which revealed much higher public borrowing than was... 10th December 2003 · 1 min read
UK Economics Focus Pre-Budget Report 2003 - Preview Gordon Brown will present his seventh Pre-Budget Report (PBR) on December 10th against a now familiar background of rapidly escalating public borrowing. We expect him to push his forecast for Public... 3rd December 2003 · 1 min read
UK Economics Focus Gearing up for a household borrowing slowdown Household debt continues to rise at worryingly rapid rates, having already reached record highs relative to households’ income. Admittedly, debt servicing costs are historically low, with interest... 26th November 2003 · 1 min read
UK Economics Focus The return of negative equity With the threat of falling house prices around the corner, the question inevitably arises of whether we are about to see a return of the widespread negative equity of the 1990s, when thousands of... 20th November 2003 · 1 min read
