Pressure eases on public finances, but not enough to finance a big Birthday gift without recourse to higher taxes. Honey, Hammond, I shrank the deficit.  Another welcome surprise for UK public finances, with the amount of borrowing needed to plug the deficit falling by £5bn in May. £2bn lower than a year earlier. We’ve just...Read More

Big, expensive, marred by controversy and inherently political. No, not the World Cup. QE. And the final whistle for this extraordinary period for monetary policy is approaching. At least for this round. And there’s always the chance of extra time.   Widespread Weakness. Concerns are rising about the performance of the UK economy in Q2....Read More

A reversal of fortune in the service sector should hair a return to business as usual for the UK economy.   Pressure building. Confidence returned to the UK service industry in May with its PMI reaching 54.0, up from 52.8 in April. That’s the second month of recovery since the snow-induced slowdown and bodes well...Read More

Despite strong investment, record employment and (finally) real pay growth, weak spending slows the economy. Hiring on all cylinders. The UK’s well-oiled jobs machine continues to produce the goods. Another month, another record high in employment and the employment rate. The number of people in work rose by 197k in Q1, taking the total to...Read More

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