UK Economics Update Spending on cars puts brakes on consumption growth Spending on cars has fallen sharply since the EU referendum, and unless a Brexit deal is agreed we suspect that it will remain a drag on consumer spending growth for a few years yet. 29th July 2019 · 4 mins read
UK Economics Update Fiscal rules are made to be broken Any spending spree by the new administration will probably be accompanied by a rise in borrowing, which could breach the current fiscal rule, especially if there is a no deal Brexit. However, fiscal... 24th July 2019 · 3 mins read
UK Economics Update New Prime Minister: Brace for turbulence Despite his hard-line stance on the campaign trail, there is no way of knowing how Boris Johnson will handle Brexit once he becomes Prime Minister tomorrow. But it’s going to be turbulent and the... 23rd July 2019 · 4 mins read
UK Economics Update Pick your own Brexit forecast As long-term clients will know, we have been publishing different forecasts for the economy based on two different Brexit outcomes, “deal on 31st October” and “no deal on 31st October”. We are now... 1st July 2019 · 6 mins read
UK Economics Update And then there were two The outlook for the economy should be similar with either Boris Johnson or Jeremy Hunt at the helm. After all, both have committed to loosening fiscal policy. And although both are willing to leave... 20th June 2019 · 1 min read
UK Economics Update MPC softens tone on interest rate rises Given the drop in GDP in April and the fall in inflation back to target in May, there was never much chance that the MPC would raise interest rates from 0.75% today. What’s more, the tone of the... 20th June 2019 · 1 min read
UK Economics Update Equities may be the next shoe to drop Just as we had expected, global forces have contributed to 10-year gilt yields falling below 1.00% and the pound weakening to a recent low of close to $1.25. If we are right in thinking that the... 5th June 2019 · 1 min read
UK Economics Update The policies of the 12 trying to get into Number 10 While the 12 candidates for the leadership of the Conservative party are divided over the best approach to Brexit, they seem reasonably united in calling for looser fiscal policy. That could give the... 4th June 2019 · 1 min read
UK Economics Update No change in households’ appetite to spend Reassuringly, following the raft of weak survey data released this week, consumer credit growth held up well in April. And with the labour market healthy and interest rates only likely to rise... 31st May 2019 · 1 min read
UK Economics Update Prime Minister Theresa May resigns The resignation of Prime Minister, Theresa May, supports our recent view that the chances of a Brexit deal have fallen and that the chances of another delay and a no deal Brexit have risen. While the... 24th May 2019 · 1 min read
UK Economics Update Don’t write off higher inflation Yesterday’s revelation that inflation in April rose above the Bank of England’s 2% target captured the headlines, but inflation was actually weaker than we had expected. A closer inspection suggests... 23rd May 2019 · 1 min read
UK Economics Update Brexit events raise risk economy is in limbo for longer The reaction to Theresa May’s “new” Brexit deal suggests that the chances of a deal have fallen and the chances of another delay, a no deal, no Brexit and/or a general election have all risen. It’s... 22nd May 2019 · 1 min read
UK Economics Update Where should interest rates be? A policy rule suggests that for the time being the financial markets may be justified in taking a relatively sanguine approach towards the risk of rising interest rates. But should a Brexit deal be... 21st May 2019 · 1 min read
UK Economics Update Who is getting a pay rise of over 3%? The labour market is running hot, but some people doubt that wages are rising by more than 3% a year. That is probably because higher pay growth is being driven by the small share of workers switching... 16th May 2019 · 1 min read
UK Economics Update Rising services inflation to bolster case for rate hikes The sluggishness in CPI inflation can partly be explained by factors that will prove temporary. And with cost pressures building, there is scope for services inflation to push the CPI rate higher than... 9th May 2019 · 1 min read
UK Economics Update What Q1 will give, Q2 may take away While the release of the GDP data for Q1 this Friday will probably show that the economy grew at a healthy clip, we doubt that Q2 will be as good. 8th May 2019 · 1 min read
