UK Economics Weekly Labour market casts a dark shadow over the recovery While there are signs that the economy is recovering more quickly than expected, a large rise in unemployment is on the horizon. This, combined with Brexit uncertainty and the possibility of further... 3rd July 2020 · 4 mins read
UK Data Response Quarterly National Accounts & Balance of Payments (Q1) The 2.2% q/q drop in GDP in Q1 2020 was the joint largest fall since 1979 and sets the stage for an unprecedented 15-20% fall in Q2, despite evidence that the economy rebounded in May and June. 30th June 2020 · 2 mins read
UK Data Response EC Economic Sentiment (Jun.) The rise in the UK Economic Sentiment Indicator in June suggests that the economy is continuing to recover after its nadir in April. But firms and households are becoming more downbeat on the outlook... 29th June 2020 · 2 mins read
UK Markets Chart Pack Return of risk appetite to buoy assets if virus contained Market conditions have generally improved in recent months, with government bond yields remaining low, corporate bond spreads almost back to their pre-coronavirus levels and the FTSE 100 recovering... 25th June 2020 · 8 mins read
UK Data Response IHS Markit/CIPS Flash PMIs (Jun.) The nature of the PMIs makes them tricky to interpret at the moment, but the rise in the composite PMI from 30.0 in May to 47.6 in June (consensus 41.0) suggests that the additional easing in the... 23rd June 2020 · 3 mins read
UK Data Response Public Finances (May) The double whammy of the precipitous fall in economic activity and the government’s measures to combat the crisis has already pushed the debt to GDP ratio above 100% for the first time in over 50... 19th June 2020 · 3 mins read
UK Economics Update MPC will do more QE, eventually We think today’s Monetary Policy Committee decision to keep rates on hold at +0.10% and increase Quantitative Easing (QE) by £100bn is unlikely to be the last act of policy loosening. And while we... 18th June 2020 · 3 mins read
UK Economics Weekly Climb back up the cliff will take much longer than the fall off it The 25% drop in GDP compared to its pre-crisis level was exactly in line with our forecast made in April. But even though the worst is now behind the climb back up the economic cliff will take much... 12th June 2020 · 9 mins read
BoE Watch MPC to keep the printing press fired up all year The Bank of England has much more work to do. It will probably start by announcing £100bn more quantitative easing at the meeting on Thursday 18th June, and we expect additional expansions in QE over... 11th June 2020 · 8 mins read
UK Economics Update Will households spend their savings? The bulk of the leap in the saving rate will be reversed as the economy opens and people start spending again but the desire to hold more savings post-lockdown combined with lower incomes will weigh... 10th June 2020 · 3 mins read
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 Chart Pack Output only crawling back While the most restrictive period of the lockdown is behind us, the measures enforcing business closures and social distancing are only being eased very gradually. According to the ONS “Business... 4th June 2020 · 9 mins read
UK Economics Focus Another decade of ultra-loose monetary policy The swift and significant response of the Bank of England to the coronavirus crisis has prevented a financial crisis, but we think the Bank will need to do much more than the markets currently expect... 4th June 2020 · 31 mins read
UK Data Response Money & Credit (Apr.) The record fall in net loans to households and another surge in borrowing by businesses in April is an indication of how the lockdown has affected consumer spending and business revenues. These trends... 2nd June 2020 · 2 mins read
UK Data Response Retail Sales (Apr.) The 18.1% m/m fall in retail sales volumes in April was easily the largest on record. The good news is that April should be the low point. But the bad news is that May is unlikely to be a huge amount... 22nd May 2020 · 3 mins read
UK Economics Update Pound taking a one-two punch from coronavirus and Brexit The recent weakness in the pound has been driven by renewed concerns about Brexit and the prospect that the Bank of England will have to cut interest rates below zero to support the economy. As a... 19th May 2020 · 3 mins read
