UK Economics Update UK faces bigger external threats than a China slowdown The UK has become significantly more exposed in recent years to the Chinese economy, which has made a poor start to 2015. But this shouldn’t cause the UK economy too many problems – Greece remains by... 23rd June 2015 · 1 min read
UK Economics Update Pension reforms giving small boost to spending The Chancellor’s announcement regarding the amount of money withdrawn from pensions since the new freedoms took effect in April supports our view that the changes will provide a boost, but a... 18th June 2015 · 1 min read
UK Economics Update MPC unlikely to follow the US Fed closely this time The conventional wisdom is that when the US Fed changes interest rates, the UK MPC usually follows suit soon after. However, the historical record contains several exceptions to this pattern. And as... 17th June 2015 · 1 min read
UK Economics Update Most sectors have scope for productivity rebound One area of debate surrounding the UK’s productivity puzzle regards whether the UK’s weak productivity growth is confined to just a few sectors or is a more widespread problem. We still think that... 15th June 2015 · 1 min read
UK Economics Update Deflation Watch: UK to exit deflation after just a month May’s inflation figures should show that deflation in the UK lasted for just a month. Admittedly, this would not mean that the risk of a prolonged period of low inflation has suddenly disappeared... 11th June 2015 · 1 min read
UK Economics Update Has food price inflation reached a trough? There are good reasons to think that food price inflation has reached a trough. That said, intense supermarket competition seems unlikely to lift soon, meaning that inflation in the sector could... 8th June 2015 · 1 min read
UK Economics Update Inflation risks to keep MPC on hold throughout 2015 With the UK in deflation, growth indicators turning south and the Greek saga casting a shadow over the outlook, the MPC’s decision to keep interest rates on hold is likely to have been unanimous again... 4th June 2015 · 1 min read
UK Economics Update Has the boom in car sales run out of gas? The recovery in car sales has lost momentum this year despite the fact that the cost of credit is about as cheap as it can get. But the healthy outlook for households’ incomes, the low level of oil... 4th June 2015 · 1 min read
UK Economics Update Household Borrowing Monitor (Apr.) Growth in household borrowing is beginning to strengthen in response to record-low lending rates and high levels of confidence. And since this revival is coming from a low base and household incomes... 2nd June 2015 · 1 min read
UK Economics Update Slowdown in spending in Q1 won’t be long-lasting Whilst the second estimate of Q1 GDP confirmed that household spending growth slowed a touch at the start of the year, rising nominal wages, falling unemployment and the boost from lower food and... 28th May 2015 · 1 min read
UK Economics Update Will the fiscal squeeze boost inflation again? One upside risk to inflation is that the Conservatives try to plug some of the hole in the public finances by raising taxes on goods and services in the CPI basket. But given that they have ruled out... 27th May 2015 · 1 min read
UK Economics Update Unfunded pledges give Osborne a tough choice The Conservatives have made their job of eliminating the budget deficit by 2018/19 even harder by announcing a number of unfunded policy pledges in the run-up to the election. But the fact that they... 20th May 2015 · 1 min read
UK Economics Update Deflation Watch: Negative inflation, but for one month only Tuesday’s inflation figures look set to show that the UK slipped into deflation in April. But this is likely to have largely reflected the timing of Easter this year compared to last. Since the oil... 15th May 2015 · 1 min read
UK Economics Update Austerity and low inflation likely to keep MPC inactive Since the first estimate of Q1 GDP has cast some doubt over the recovery’s health, the MPC is likely to have voted unanimously again at this month’s meeting to keep interest rates on hold. And while... 11th May 2015 · 1 min read
UK Economics Update Has the general election changed the consumer outlook? With the Conservatives achieving an overall majority in the general election, we now know that consumers are set to face another five years of harsh austerity. But on the whole, households look better... 8th May 2015 · 1 min read
UK Economics Update Tory win removes risk of prolonged political uncertainty With the Conservatives on course to achieve an overall majority, the UK general election result is a surprisingly market-friendly outcome and removes the risk that the economy suffers a prolonged... 8th May 2015 · 1 min read
