Since 2008 the major central banks have been, by and large, pushing in the same direction. No longer. There’s widening clear blue water separating the outlook for interest rates either side of the pond. Old Gods. The UK private sector slowed to a 20-month low in March, accompanied with much harking at the weather and...Read More
A sharp slowdown in economic activity adds to calls for the bank of England to pause before raising interest rates. Wipeout. The UK eked out growth of a paltry 0.1% between Q4 and 2017 and Q1, the slowest pace in over five years and well short of the 0.3% expected. Sobering stuff. But digging underneath...Read More
An exceptionally hot spell of spring weather has brought out the beachwear and disagreements on the MPC. Phew! January 2017 marked the end of the two-year ‘consumer sweet spot’ whereby wage growth outstripped inflation. But in 2018 the mood is brightening. UK wages rose faster than inflation in the three months to February. Excluding bonuses,...Read More
Not only has the poor weather prolonged winter and darkened our moods, it also looks to have taken a fair slice off economic growth in the first quarter. With luck it’s just a blip. In its stride. UK manufacturing production fell 0.2% between February and March, the first decline in a year. There may...Read More
You might love them or loathe them but the inescapable fact is that the UK’s recent snow days have had a big impact on business. The latest surveys suggest only manufacturers managed to escape unscathed. Snowdown. Meatloaf sang ‘Two out of three ain’t bad’, but the latest UK PMIs signalled that two out of three...Read More
Two years of falling real wages look likely to come to an end, just what an embattled high street is crying out for. Full speed ahead. To paraphrase, nothing in life is certain expect death, taxes and clear evidence that, so far, Brexit has had no discernible impact on the labour market. The number of...Read More
The Chancellor opted not to make any changes to tax or spending policy at last week’s Spring Statement, so instead the focus was firmly on the economic assumptions that underpin the public finances. Low key. The Treasury had promised that the inaugural Spring Statement would not be a “fiscal event”. It was not. The Chancellor...Read More
President Trump imposes tariffs to protect heavy industry whilst a new group of countries slashes barriers. Gloves off. President Trump threw down a gauntlet last week by imposing tariffs on steel and aluminium imports from all countries other than Canada and Mexico. Responses from China and the EU seem inevitable, first to combat damage to...Read More
Last week’s snow induced disruption will have heaped pressure on sectors like retail, leisure and construction. Firms will have to fight hard amid cancellations to manage cash flow and clear backlogs. It might even knock a tenth of a percent or two off Q1 GDP growth. But it is consumers’ attitudes to borrowing which is...Read More
One swallow a summer does not make, but two swallows? Probably still not enough for a turning point, however much we’d like the UK to crack its productivity problem. More for less. Here’s a cause for celebration. The UK has notched up two quarters on the spin of decent productivity growth. Output per hour...Read More
