UK Economics Weekly Some households flush with cash, but won’t spend it soon Even those households that have built up their savings are unlikely to go on a spending spree once the economy reopens. As a result, the Bank of England will have to do more QE than the market expects... 5th June 2020 · 8 mins read
UK Economics Weekly Slow path to normality, still on track for more QE The government’s plans for a progressive opening up of non-essential stores in June suggest that the low point for the economy is behind us. But with the damage caused by the lockdown measures likely... 29th May 2020 · 5 mins read
UK Economics Weekly It’s all gone a bit negative The recent apparent change of heart of the Bank of England Governor on negative interest rates largely explains why gilt yields are now below zero out to five years. But while the possibility of... 22nd May 2020 · 4 mins read
UK Economics Weekly Debt lessons from the east The Treasury is reportedly already thinking up ways to reduce public debt in the aftermath of the coronavirus crisis in order to maintain investors’ confidence. But other countries with much higher... 15th May 2020 · 10 mins read
UK Economics Weekly Credit won’t hold back the recovery, more to come from BoE There can be little doubt about how bad the recession will be now that the Bank of England has joined us and the OBR in forecasting that GDP will fall by 25-30%. But even so UK banks should be able to... 7th May 2020 · 8 mins read
UK Economics Weekly Easing envy, Bank having a good crisis so far Brits will have to cope with “easing envy” for a while yet as it appears as though when the government reviews the coronavirus lockdown next Thursday it will just publish a “road map” of how to reopen... 1st May 2020 · 5 mins read
UK Economics Weekly Hit to employment to prevent a perfect V-shaped recovery The big declines in retail sales volumes in March and in the PMI activity surveys in April make it clear that the slump in activity has been unprecedented in terms of its speed and its severity. We... 24th April 2020 · 4 mins read
UK Economics Weekly Some parts of the economy may take five years to recover We fear that the Office for Budget Responsibility’s view that there won’t be a lasting economic legacy from the coronavirus crisis is too optimistic. We think it will take almost three years for the... 17th April 2020 · 10 mins read
UK Economics Weekly Hit to economic health will linger for years With the number of people fighting COVID-19 in hospital rising day by day, the recent talk of an “exit strategy” from the lockdown appears premature. Even when the restrictions are lifted, consumer... 9th April 2020 · 4 mins read
UK Economics Weekly Government schemes falling down in practice Despite policymakers’ best efforts, it is looking more likely that the unemployment rate and businesses insolvencies could rise as high as in the Global Financial Crisis. 3rd April 2020 · 7 mins read
UK Economics Weekly Policymakers do their utmost, but some damage already done The UK Chancellor’s support for self-employed workers takes the total size of the government’s package of direct tax and spending measures to £119bn (5.3% of GDP). Even so, this unparalleled policy... 27th March 2020 · 4 mins read
UK Economics Weekly Health crisis => economic crisis => financial crisis? There is no doubt that the coronavirus health crisis has already led to an economic crisis and this week we saw the first real signs of severe disruption in the financial markets. Whatever happens, an... 20th March 2020 · 6 mins read
UK Economics Weekly A recession and more policy action is coming As it seems increasingly inevitable that a further spread of the coronavirus will have a significant impact on the economy, we are changing our forecasts. We now expect a recession that will involve... 13th March 2020 · 6 mins read
UK Economics Weekly Coronavirus complicates new policymakers’ task The drop back in equity prices this week heaps more pressure on the new head honchos at the Treasury and the Bank of England to deliver some measures to help mitigate the economic effects of the... 6th March 2020 · 7 mins read
UK Economics Weekly Could the markets force the MPC to cut rates? The sharp falls in equity prices show that things are moving fast and this week we revised down our 2020 GDP growth forecast to reflect the damage to the global economy from the coronavirus. But the... 28th February 2020 · 5 mins read
UK Economics Weekly Economic rebound in progress, but clouds on the horizon The first official data for January piled more evidence onto our view that the economy will rebound in Q1 2020 after hitting a nadir in Q4 2019. But the growing impact of coronavirus on China’s... 21st February 2020 · 4 mins read
