UK Economics Update Widening pension deficits another constraint on investment An important consequence of the recent sharp falls in asset prices is an increase in the size of firms’ pension fund deficits. With profits set to fall sharply and the credit crunch reducing firms’... 17th November 2008 · 1 min read
UK Economics Update Jobs shake-out to become more broad-based Tomorrow’s labour market figures are set to reveal a further drop in employment, confirming that the downturn in the labour market is well underway. We expect employment to drop by around 1.5 million... 11th November 2008 · 1 min read
UK Economics Update Jobs shake-out to become more broad-based Tomorrow’s labour market figures are set to reveal a further drop in employment, confirming that the downturn in the labour market is well underway. We expect employment to drop by around 1.5 million... 11th November 2008 · 1 min read
UK Economics Update Mortgage interest rates heading to 3% Today’s interest rate cut, from 4.5% to 3%, marks only the early stages of a phase of aggressive monetary easing which will ultimately take base rates to an all-time low of 1%. Mortgage interest rates... 6th November 2008 · 1 min read
UK Economics Update Mortgage interest rates heading to 3% Today’s interest rate cut, from 4.5% to 3%, marks only the early stages of a phase of aggressive monetary easing which will ultimately take base rates to an all-time low of 1%. Mortgage interest rates... 6th November 2008 · 1 min read
UK Economics Update Fireworks from the MPC, and much more to come A day late maybe, but the Monetary Policy Committee certainly delivered some spectacular fireworks today in the form of the 150bp cut in interest rates, the biggest move since 1992. But rates still... 6th November 2008 · 1 min read
UK Economics Update Fireworks from the MPC, and much more to come A day late maybe, but the Monetary Policy Committee certainly delivered some spectacular fireworks today in the form of the 150bp cut in interest rates, the biggest move since 1992. But rates still... 6th November 2008 · 1 min read
UK Economics Update How much will payment protection insurance cost insurers? Despite the write-downs already made, the financial sector has yet to face billions of pounds of further losses associated with the downturn in the economy. Our forecast that unemployment will... 4th November 2008 · 1 min read
UK Economics Update UK interest rates to fall to 1%. Extraordinary circumstances require extraordinary actions. With the current recession likely to be deeper than that in the early 1990s and the credit crunch impairing the effectiveness of monetary... 29th October 2008 · 1 min read
UK Economics Update Financial Stability Report highlights threat to bank lending The Bank of England’s latest Financial Stability Report (FSR) supports our view that the Government’s recapitalisation of the banking system is unlikely to head off a sharp slowdown in bank lending... 28th October 2008 · 1 min read
UK Economics Update What scope for looser fiscal policy? Just how much scope does the Government have to support the economy through looser fiscal policy - i.e. tax cuts or spending increases? At first sight, the answer might appear to be absolutely none at... 27th October 2008 · 1 min read
UK Economics Update New forecasts for currencies and commodities The recent acceleration in the dollar’s appreciation against other major currencies (with the notable exception of the yen) reflects a combination of factors, none of which is likely to reverse any... 22nd October 2008 · 1 min read
UK Economics Update Manufacturing - as bad as the early 1990s The recent deterioration in activity both at home and overseas has cast a large cloud over the outlook for the manufacturing sector. We now think that manufacturing output will fall from peak to... 21st October 2008 · 1 min read
UK Economics Update Bond market’s inflation expectations set to fall further If we are right in thinking that the UK economy will flirt with deflation next year, conventional bond yields could drop to very low levels. 16th October 2008 · 1 min read
UK Economics Update Has the housing market outlook changed? What a tumultuous few weeks! Policymakers around the world have stepped in to bail out the banking system, hopefully averting full-scale financial system meltdown, and UK interest rates have been cut... 16th October 2008 · 1 min read
UK Economics Update Recapitalisation unlikely to revitalise bank lending With banks’ balance sheets under pressure, UK bank lending is set to rise more slowly, if not fall outright. This will have significant adverse effects on the UK economy, which may already be in... 13th October 2008 · 1 min read
