How to stop worrying and learn to love the economy. Beneath the headlines, last week’s data depict a reasonably sunny economic landscape across the Eurozone, the US and, even the UK.     Hope. UK manufacturers are increasingly upbeat. The PMI manufacturing survey rose again in August to 56.9 up from 55.3 in July, the second highest...Read More

Confirmation, if one was needed, of a slowdown in the UK economy in the first half of 2017. Faster price rises have slowed consumer spending to a sloth-like pace. It’s rebalancing Jim (of sorts), but not as we wanted.    Fragile. Q2 GDP growth was confirmed at 0.3%, meaning the economy is now 1.7% larger...Read More

The financial crisis may be ten year’s old, yet many of the problem it exacerbated are even older.   Lost. Last week marked the tenth anniversary of what is widely considered to be the beginning of the financial crisis. It was so long ago the first iPhone hadn’t even been released in the UK (it...Read More

The summer’s weather has been, by and large, a mixture of sunshine and showers. The economic weather has been similar, with the number of ‘positive’ economic results generally matching the number of ‘negative’ ones. In this climate it’s often best to wait and see, which is exctly what the MPC opted to do last week....Read More

Does June’s unexpected fall in the rate of inflation herald the start of a retreat? It seems unlikely. The fall in sterling that has helped push inflation higher is still filtering through into consumer prices. And even at the lower rate inflation remains uncomfortably above wage growth. That’s a considerable headwind for the economy.   Pause...Read More

Despite yet another strong set of job numbers, there are still no signs of life in the wage growth figures. In response, consumers are saving less and borrowing more. That’s not a sustainable solution.   The 1975. Derby County were champions of England, Bay City Rollers were number one in the charts, Fawlty Towers was about...Read More

Hope fades that the UK economy managed to step up a gear in Q2. Most estimates now suggest quarterly UK GDP growth was 0.3% in the three months to June, barely an improvement on Q1’s disappointing 0.2%.  Soft. First, the good news. Manufacturing output was 0.4% higher in May compared to the same month in...Read More

The UK’s Propensity to borrow too much and save too little has echoes of the recent past.  Yet investment isup and there’s little sign of imminent danger.  Still, the Bank of England’s Financial Stability Report worries the pasy may be ahead of us. Weak and Wobbly.  As we approach the tenth anniversary of the global...Read More

“Give me a one-handed economist,” pleaded President Harry Truman, “all my economists say, ‘on the one hand, but on the other’.” On the one hand. Last week two Monetary Policy Committee members explained the background to the previous week’s 5-3 vote to keep Bank Rate on hold. Governor Mark Carney was emphatic that, “now is...Read More

Three members of the Monetary Policy Committee voted last week to raise Bank Rate to 0.5%.  This is a surprise to say the least as inflation is above target at 2.9%, and heading higher. Yet while employment continues to rise, wage growth is slowing, consumers are under pressure and there is enough uncertainty around to...Read More