Pantheon Publications
Below is a list of our Publications for the last 6 months. If you are looking for reports older than 6 months please email info@pantheonmacro.com, or contact your account rep.
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Samuel Tombs
- In one line: Continued hawkishness suggests May still is the earliest plausible date for the first rate cut.
Samuel TombsUK
- The MPC still thinks that monetary policy will need to be restrictive “for an extended period of time”.
- It downplayed recent downside data surprises and continued to fret about upward inflation risks.
- It will wait for clarity on fiscal policy and the impact of the NLW hike before easing; the first cut will come in May.
Samuel TombsUK
- Most of October’s 0.3% month-to-month fall in GDP probably was reversed in November...
- ...Some sectors struggled in October due to bad weather; survey and employee data point to modest GDP growth.
- The near-term outlook for real household disposable income is positive; a recession is still only a tail risk.
Samuel TombsUK
- In one line: A broad-based drop, but expect a recovery in the final two months of 2023.
Samuel TombsUK
- In one line: The trend in wage growth is weakening, but not as dramatically as October’s data imply.
Samuel TombsUK
- The first estimate of a month-to-month drop in wages in October likely will be revised to a small rise soon...
- ...but the rising trend has weakened greatly since Q2, and PAYE RTI data point to further near-term weakness.
- Wage growth will accelerate only slightly in the run-up to April’s NLW hike; the MPC can cut rates in May.
Samuel TombsUK
- Services CPI inflation likely rose to 6.6% in November, from 6.5%, but undershot the MPC’s 6.9% forecast.
- Surveys point to an ongoing slowdown in service price rises; the energy price shock has filtered through...
- ...But accommodation services and TV subscription prices likely picked up in November.
Samuel TombsUK
- In one line: Consistent with unemployment rising more quickly than the MPC expects.
Samuel TombsUK
- Recent CPI inflation and wage data have undershot the MPC’s expectations...
- ...and it will judge that sterling’s appreciation will offset the boost to inflation from lower rate expectations.
- But Mr. Bailey has repeatedly pushed back against the fall in rate expectations; don’t expect a dovish tone yet.
Samuel TombsUK
- We think GDP rose by 0.1% month-to-month in October, despite disruption from Storm Babet.
- The composite PMI points to a decline in activity, but we think it has been excessively weak recently.
- Output in the health sector likely increased again, driven by a pick-up in Covid booster vaccinations.
Samuel TombsUK
- Employee numbers likely were broadly unchanged month-to-month in November.
- PAYE figures and ONS survey data point to a further loss of upward momentum in wages in October...
- ...But rises in the Real Living Wage and public- sector pay likely supported growth temporarily
Samuel TombsUK
- In one line: Consistent with a modest revival in retail sales; expect a fuller recovery in 2024.
Samuel TombsUK
- Redundancy notifications jumped in mid-November; the rise isn’t just due to one big business failure.
- Both the Adzuna and Indeed measures of job vacan- cies also have fallen during the fourth quarter.
- Some measures of employment intentions are robust, but job hoarding might ease as unemployment rises.
Samuel TombsUK
- CPI inflation likely fell to 4.4% in November, from 4.6% in October, remaining 0.2pp below the MPC’s forecast.
- BRC and Eurozone data both point to further falls in food and core goods CPI inflation.
- Motor fuel CPI inflation also declined in November; surveys point to slowing service price rises too.
Samuel TombsUK
- The latest data add weight to our view that a recession will be avoided and Bank Rate will start to fall from Q2.
- GDP looks set to increase by 0.3% q/q in Q4, with a recovery in real incomes driving household spending.
- The Autumn Statement has done little to change our forecasts, we still expect fiscal consolidation in 2024/25.
Samuel TombsUK
- In one line: Households remain focussed on repaying debt and replenishing their savings, but we doubt they will become even more cautious ahead.
Samuel TombsUK
- Households made another net repayment of mortgage debt in October; expect more of the same this winter.
- September’s rise in the household saving rate was sustained in October, but we don’t expect a further increase.
- Many households have now regained the savings buffer they lost in 2022; unsecured borrowing has scope to rise.
Samuel TombsUK
- The OBR expects growth in output per hour of 1.0% y/y over the next five years, above the 2010s average, 0.7%...
- ...But it has averaged 0.5% since 2019, and that assumes employment has risen as slowly as the LFS implies.
- Productivity in the manufacturing sector will eventually snap back, but a wider acceleration isn’t likely.
Samuel TombsUK
LARGE FISCAL SQUEEZE STILL PLANNED FOR 2024...
- ...INFLATION WILL FALL FURTHER, TEEING UP A MAY RATE CUT
Samuel TombsUK
- Most supermarkets can raise wages by just 4% in 2024 and remain compliant with the National Living Wage...
- ...They no longer need to pay staff a larger-than-usual premium over the NLW, given the rise in unemployment.
- Firms told the Low Pay Commission they doubt they will pass on higher labour costs in 2024 as much as in 2023.
Samuel TombsUK
