Filtered by Subscriptions: UK Economics Use setting UK Economics
October’s Markit/CIPS manufacturing survey provided some tentative signs that the sector’s recovery regained some momentum at the beginning of Q4. However, it will remain up to the services sector to drive overall growth in the near term. … Markit/CIPS …
3rd November 2014
While the additional minimum capital buffers announced by the Financial Policy Committee (FPC) this afternoon will require some banks to raise more capital over the coming years, they do not appear to be tough enough to prevent the recovery in bank …
31st October 2014
Given the perceived boost to the economic recovery from strong gains in house prices over the past year or so, signs that the housing market is beginning to cool may raise concerns that the overall economic recovery may slow along with it. … Cooling …
While the GfK/NOP composite index of consumer confidence edged down again in October, it remained consistent on past form with robust spending growth. What’s more, sentiment should be supported by a recovery in real pay in the months ahead. … GfK/NOP …
The current weakness of domestic price pressures and the euro-zone’s continued malaise suggest that the MPC is likely to keep Bank Rate on hold for a few more months. But the Committee is unlikely to wait for all of the downside risks to the growth …
30th October 2014
The latest monetary indicators provided further evidence to suggest that there is no pressing need for the Monetary Policy Committee to start to raise interest rates yet. … Monetary Indicators Monitor …
29th October 2014
September’s household borrowing figures confirmed that new mortgage rules and cooling demand have continued to weigh on mortgage approvals. However, we doubt that this downward trend will persist for much longer. … Household Borrowing Monitor …
While it is encouraging that all four of the major UK banks passed the European Banking Authority’s stress tests, the narrow margin by which some did so raises concerns that the Bank of England’s more stringent tests later this year will require banks to …
27th October 2014
The CBI Distributive Trades Survey provided an encouraging sign that retail sales picked up in October following weather-related weakness last month. What’s more, the prospects for consumer spending over the coming months look bright. … CBI Distributive …
On the face of it, the recent sharp fall in equity prices and slowdown in the housing market suggest that the significant improvement in consumer confidence seen over the last year might be reversed soon. But other developments – such as the easing of the …
24th October 2014
The preliminary estimate of Q3 GDP showed that the UK’s economic recovery has broadly maintained its momentum despite the weak global environment and stronger sterling exchange rate. … Preliminary estimate of GDP …
The outlook remains bright for further strong growth in consumer spending over the coming quarters. Although the jobs recovery has slowed, the economy has retained a healthy degree of momentum, suggesting that productivity is finally on the rise. This …
23rd October 2014
While the economy’s recent revival has so far failed to deliver the Conservative party a sustained lead in the opinion polls, there are reasons to think that this could change before the general election. … Could the economy still propel the Tories to …
The weaker-than-expected tone of October and Q4’s CBI Industrial Trends Survey added to other indicators which suggest that the near-term outlook for UK manufacturers remains pretty gloomy. … CBI Industrial Trends Survey (Oct & …
September’s monthly decline in retail sales volumes can be entirely explained by temporary factors. Indeed, the recovery in consumer spending still looks robust. … Retail Sales …
The minutes of October’s MPC meeting showed that the views of those voting to keep interest rates on hold have becoming more entrenched. As such, we have pushed back our forecast for the first rise in Bank Rate from February to May 2015. … MPC Minutes …
22nd October 2014
Lower oil and food prices should provide a timely boost to consumer spending at a time when employment growth has faded and financial asset prices are falling. … Lower commodity prices to bolster consumer …
17th October 2014
Last week saw global financial markets return to panic mode, as concerns about the faltering euro-zone economy, heightened geopolitical risks, the spread of the Ebola virus and falling oil prices came to the fore. Amidst the gloom, however, a piece of …
Rapid growth in the UK’s workforce in spite of both demographic and international trends has been crucial to sustaining the economic recovery and preventing it from stoking inflation. Looking ahead, we are confident that labour supply will continue to …
16th October 2014
The latest labour market figures indicated that the economy is finally starting to see the pick-up in productivity that is required for both the recovery to maintain its present momentum and real earnings to increase sustainably. … Labour Market Data …
15th October 2014
September’s sharp fall in consumer price inflation supports those members of the Monetary Policy Committee arguing that there is still no hurry to raise interest rates. … Consumer Prices & Producer Prices …
14th October 2014
September’s BRC Retail Sales Monitor highlighted the diverging prospects for the food and non-food retail sectors. Whilst growth in overall retail spending may have slowed a touch in Q3, it should maintain a decent pace over the next year or so. … BRC …
Concerns that the euro-zone’s faltering recovery will drag the UK’s own into the doldrums appear somewhat overblown. Past experience shows that the UK economy has been able to outperform the euro-zone’s for prolonged periods, and we think that it will …
13th October 2014
On the face of it, the sharp decline in the FTSE 100 to its lowest level since last October appears to be a bad portent regarding the sustainability of the UK economy’s recovery. However, the FTSE’s global orientation means that it is no longer a good …
10th October 2014
With inflation easing, the housing market cooling and the euro-zone’s recovery fading, the majority of MPC members voting to keep Bank Rate on hold is unlikely to have been whittled down at this month’s meeting. And with inflation set for further …
9th October 2014
Although we anticipate that the first interest rate hikes in both the US and the UK will come around the same time, towards the end of the first quarter next year, we expect the subsequent pace of tightening to be more gradual in the UK. Indeed, by the …
8th October 2014
August’s fairly weak industrial production figures provided further evidence thatthe economic recovery remained unbalanced in the third quarter. Meanwhile, Q3’sCredit Conditions Survey suggested that mortgage lending should pick up soon. … Industrial …
7th October 2014
The sharp decline in the manufacturing PMI and smaller fall in the services PMI in September has led some to question the durability of the UK’s economic recovery. There is little reason to be worried at this stage, though. For one, the broader range of …
3rd October 2014
While the economic recovery seems to have broadly maintained its strong pace in the third quarter, the latest national accounts contained signs that the recovery has exacerbated some of the economy’s existing weaknesses. Indeed, the current account …
September’s strong CIPS report on services provided reassurance that the fall in the manufacturing PMI was not symptomatic of a wider malaise and that the recovery will remain fairly strong over the next year, despite some intensifying headwinds. … …
With both current and pipeline price pressures easing, the housing market cooling further and the international environment souring over the last month, it seems unlikely that any other MPC members will join the minority of two already voting to raise …
2nd October 2014
September’s CIPS manufacturing survey provided another sign that the sector’srecovery lost some vim in the third quarter. However, we doubt that this summer’ssoftening marks the beginning of a prolonged slowdown. … Markit/CIPS Report on Manufacturing …
1st October 2014
Revisions have left the recovery in household spending since 2009 looking a little less strong thanpreviously thought. Nonetheless, recent spending growth remains robust by past standards and thedrivers of spending look set to become more sustainable. … …
30th September 2014
The significant revisions to the UK’s national accounts have not changed the fundamental picture that the economy’s performance since the recession began in 2008 has been very weak by historical and international standards. … National Accounts & Balance …
August’s household borrowing figures provided further evidence that the recovery isnot being driven by an unsustainable credit binge. And while mortgage lending shouldpick up as the economic backdrop improves, only a gradual revival seems likely. … …
29th September 2014
The continued weakness of growth in broad money and bank lending provides more evidence that the low level of interest rates is not causing the economy to overheat. … Monetary Indicators Monitor …
With the party conference season in full swing, attention has turned from the Scottish referendum to the main parties’ plans for fiscal policy in the next parliament. But while their new pledges may sound prudent, the reality is that they will do little …
26th September 2014
September’s CBI Distributive Trades Survey provided another encouraging sign that the continued weakness of wages has not prevented the recovery in retail sales from remaining robust. … CBI Distributive Trades Survey …
25th September 2014
Some argue that interest rates should be raised swiftly to purge so-called “zombie” firms with low productivity. But in reality, there are few zombies and their productivity will rise as demand picks up. Punishing the rest of the economy with higher rates …
23rd September 2014
Significant methodological changes have not altered the fact that the coalition is still struggling to bring the deficit down as quickly as planned. But there are reasons to think that the borrowing trend will improve in the second half of the fiscal …
With real wages still falling, proposals to raise the national minimum wage (NMW) look set to play a key role in political parties’ general election campaigns. But given the likely adverse effects on inflation, interest rates and employment, large rises …
22nd September 2014
The absence of a major relief rally following Scotland’s rejection of independence confirms that the markets only ever placed a very small probability on a ‘Yes’ vote. Although interest rate expectations and sterling both edged up following the result, …
19th September 2014
The near-term outlook for the economy on both sides of the Scottish border has brightened following Scotland’s decision to remain part of the UK. But despite the ‘No’ vote, the UK economy will continue to be buffeted by uncertainty about its political …
The official data and survey evidence have been unequivocal in suggesting that the recovery in consumer spending has remained robust over the last few months. Admittedly, some of the existing supports to growth in consumer spending may fade soon. …
18th September 2014
August’s retail sales figures showed that the recovery in consumer spending still has momentum despite the continued real pay squeeze and looming interest rate hikes. … Retail Sales …
The minutes of September’s MPC meeting struck a fairly dovish tone, while the continued weakness of average earnings growth has bolstered the case for keeping interest rates on hold over the coming months. … MPC Minutes (Sep.) & Labour Data …
17th September 2014
August’s consumer prices figures confirmed that CPI inflation has remained on a downward trend despite the economic recovery’s strength. Looking ahead, we continue to think that it could fall to as low as 1% by the end of this year and will remain below …
16th September 2014
While the recent fall in the pound against the US dollar has been put down to the heighteneduncertainty over the Scottish referendum result, most of the drop has actually been driven by a shiftin interest rate expectations compared to those in the US. … …
12th September 2014
There is much that the Scots could learn from their Celtic neighbours. Irish independence is a story ofeventual, not immediate success. It took nearly 80 years for Irish per capita income to catch up withthe UK’s. It grew rapidly during the “Celtic Tiger” …
While retailers still face an uphill battle to attract consumers back from online shopping, recent signs suggest that shoppers may be gradually heading back into town. Retailers also seem likely to receive support from government policies and wider …
10th September 2014
