UK Economics Weekly Softer data won’t deter MPC The financial markets are probably right to assume that an interest rate rise in August is still more likely than not. Somewhat counterintuitively, lower inflation might make it easier for the MPC to... 20th July 2018 · 1 min read
UK Economics Weekly GDP figures keep MPC on track, Brexit plan softened May’s GDP figures this week confirmed that the economy is starting to regain some momentum. That said, growth was still pretty anaemic, raising the possibility that the Monetary Policy Committee could... 13th July 2018 · 1 min read
UK Economics Weekly Q2 rebound, edging closer to a rate hike, a soft Brexit? An encouraging set of Markit/CIPS surveys provided further evidence that the economy has rebounded in Q2. Meanwhile, in a speech this week, Bank of England Governor, Mark Carney, appeared to reinforce... 6th July 2018 · 1 min read
UK Economics Weekly Rate hike on its way, but a dovish shift further ahead? There was nothing in the comments made by MPC members this week, nor in the latest data releases, to make us alter our view that the MPC will raise interest rates on August 2 nd. Admittedly, Jonathan... 29th June 2018 · 1 min read
UK Economics Weekly An August hike, manufacturing rebound, Brexit deadlock The hawkish tone of this week’s MPC Minutes supports our long-held view that the Committee will raise rates in August. Elsewhere, this week’s CBI Industrial Trends Survey provided us with some... 22nd June 2018 · 1 min read
UK Economics Weekly Should we be worried by softer pay growth? We had expected the recent upward trend in nominal pay growth to come to a brief halt in April due to unfavourable base effects. But the drop in the annual growth rate of average earnings (excluding... 15th June 2018 · 1 min read
UK Economics Weekly Stronger data keeps August hike on the cards Economic growth of 0.4% or so in Q2 – as suggested by the latest business surveys – would normally be pretty respectable. But coming after Q1’s snow-related slowdown, it looks a little soft. What’s... 8th June 2018 · 1 min read
UK Economics Weekly Italian troubles shouldn’t worry the MPC While the fall in gilt yields over the past fortnight partly reflects an increase in safe haven demand, expectations for future interest rates have also slipped back. It seems unlikely, though, that... 1st June 2018 · 1 min read
UK Economics Weekly Early signs of a consumer revival Annual consumer spending growth ground to its slowest pace in six years in Q1. Alongside a string of weak early indicators of spending in Q2, that called into question our forecast of a rebound in... 25th May 2018 · 1 min read
UK Economics Weekly How long will the strength in jobs growth last? This week’s figures suggested that the labour market is in rude health. Admittedly, some of the timelier measures of employment growth have started to weaken. And with the labour market now... 18th May 2018 · 1 min read
UK Economics Weekly MPC unlikely to wait too long After the sea of downbeat economic news in recent weeks, the Monetary Policy Committee (MPC)’s decision to keep rates unchanged at its meeting in May came as little surprise. Of course, the MPC’s... 11th May 2018 · 1 min read
UK Economics Weekly Drilling down into construction’s weak start to the year The slowdown in quarterly GDP growth in Q1 begs the question whether the economy is too fragile to withstand a tightening in monetary policy anytime soon. But the slowdown was almost entirely due to... 4th May 2018 · 1 min read
UK Economics Weekly Why did the OBR get its fiscal forecasts so wrong? This week’s public finances figures showed that borrowing for the full 2017/18 financial year came in at £42.6bn, a whopping £16bn lower than that predicted by the Office for Budget Responsibility... 27th April 2018 · 1 min read
UK Economics Weekly Does falling inflation support or undermine case for rate hike? On the face of it, the fall-back in inflation in March has reduced the chances of a hike in interest rates in May. And Governor Carney’s comments appear to add weight to this view. However, an... 20th April 2018 · 1 min read
UK Economics Weekly Softer data probably won’t deter MPC The recent run of weak data suggests that a hike in Bank Rate, to 0.75% in May, is far from a done deal. But we don’t think that a May hike is now off the table. Some of the unexpected weakening in... 13th April 2018 · 1 min read
UK Economics Weekly Should we worry about the softening in the surveys? About a month ago, we warned that the severe weather around the start of March would make the economy look a bit fragile in Q1. Indeed, the weaker-than-expected services PMI survey, released this week... 6th April 2018 · 1 min read
