Pantheon Macroeconomics

Best viewed on a device with a bigger screen...

U.K. Publications

Below is a list of our U.K. 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

Please use the filters on the right to search for a specific date or topic.

Daily Monitor q2 Services

30 June 2022 Services Inflation is High Only Due to Energy Price Rises and Tax Changes

Rising energy prices likely accounted for 1.6 percentage points of May's 4.9% rate of services CPI inflation.

While the jump in the VAT rate for the hospitality and recreation sector likely has lifted it by a further 0.6pp.

Underlying services inflation, therefore, only just exceeds its 2.5% average rate in the second half of the 2010s.

Samuel Tombs (UK Economist)U.K.

29 June 2022 Does Higher Inflation than in the Euro- zone Point to a U.K.-Specific Problem?

CPI inflation in May was 1pp higher in the U.K. than in theEurozone; Brexit hasn’t helped but isn’t the main cause.

U.K. core goods prices were depressed more by lock- downs; base effects will lower the U.K.’s rate soon.

The relative strength of U.K. services inflation is due to VAT hikes and a rise in course costs for E.U. students.

Samuel Tombs (UK Economist)U.K.

23 June 2022 Core CPI inflation Already has Peaked and will Fall Rapidly in Early 2023

Core CPI inflation declined to 5.9% in May, from 6.2% in April, and will fall further in June.

Retailers are shrinking their margins, rather than passing on surging producer prices fully to consumers.

Faltering demand will constrain future core price rises, enabling the MPC to stop its hiking cycle this year.

Samuel Tombs (UK Economist)U.K.

22 June 2022 New Estimates of the Distribution of Households' "Excess Savings"

Estimates of the distribution of savings can be derived by reconciling data from a few ONS surveys.

Our calculations suggest households in the top 10% of the income distribution hold 25% of the excess savings.

The current wave of rail strikes do not meaningfully increase the risk of a recession this year.

Samuel Tombs (UK Economist)U.K.

20 June 2022 CPI Inflation Likely Undershot the MPC's Forecast Again in May

We think the headline rate of CPI inflation was stable at 9.0% in May, despite rising food and fuel inflation. 

Core CPI inflation likely fell; data suggest the rise in goods prices didn’t match the big jump a year ago. 

Retailers are starting to accept a squeeze on the margins, while used car prices are continuing to fall. 

Samuel Tombs (UK Economist)U.K.

14 June 2022 GDP Set to Contract by about 0.7% Q/Q in Q2, after April's Weak Print

April's fall in GDP was driven by Covid spending, but flat private sector GDP caused the downside surprise.

Consumer services firms likely increasingly struggled during Q2, as households' real incomes fell further.

June's extra bank holiday also will dampen Q2 GDP; the MPC has to lower its forecast for 0.1% q/q growth.

Samuel Tombs (UK Economist)U.K.

10 June 2022 April GDP Data Will Confirm the Recovery has Stalled

We look for a mere 0.1% month-to-month rise in GDP in April, only just reversing the prior month's fall.

While output in the manufacturing and distribution sectors probably rebounded.

The consumer services sector was hit by the real income squeeze, and Covid-related spending plunged.

Samuel Tombs (UK Economist)U.K.

26 May 2022 Upside Risks to Public Borrowing Won't Stop Mr. Sunak Supporting Households

Public borrowing in April was in line with the OBR’s forecast, but expect upside surprises later this year.

Mr. Sunak likely will not opt to reduce the main rate of VAT; firms would benefit more than households.

Bringing forward April 2023’s large CPI-linked increase in benefits to October would make the most sense.

Samuel Tombs (UK Economist)U.K.

19 May 2022 The Outlook for CPI Inflation Doesn't Warrant Rapid Rate Hikes

Higher energy prices and tax rises pushed up the headline rate of CPI inflation to a 40-year high in April.

But there were encouraging signs that retailers are starting to absorb some of the surge in producer prices.

Inflation will ease over the summer as base effects kick in and the real income squeeze inhibits services price rises.

Samuel Tombs (UK Economist)U.K.

17 May 2022 The Trade Deficit will Remain Large, Casting a Shadow Over Sterling

The trade deficit, excluding erratics, jumped to a recordhigh in March, largely due to the surge in energy prices.

High energy prices, surging imports of travel services and weak export growth will keep the deficit wide.

Governor Bailey is showing no signs of buckling to pressure from MPs for faster rate hikes to tame inflation.

Samuel Tombs (UK Economist)U.K.

16 May 2022 Net Upside Risk to the MPC's 9.1% Forecast for April CPI Inflation

CPI inflation likely soared to 9.2% in April, from 7.0% in March, largely due to the jump in the energy price cap.

BRC data are consistent with another large rise in core goods prices, while services prices likely shot up too...

...In response to the hospitality VAT hike, big increases in phone contract prices, and an Easter boost to airfares.

Samuel Tombs (UK Economist)U.K.

9 May 2022 GDP Likely was Unchanged in March, Preluding a Contraction in Q2

The boost to activity from the removal of final Covid restrictions likely was offset by falling health sector output.

Higher energy prices and fresh supply chain frictions, following the war in Ukraine, likely hit manufacturing.

Retail sales and car sales fell, while the recovery in the hospitality sector appears to have topped out.

Samuel Tombs (UK Economist)U.K.

25 Apr 2022 Consumers Must Draw on Savings Soon for a Recession to be Averted

March's retail sales figures were a wake-up call for investors; households are struggling to tread water.

Consumers' confidence weakened further in April and now is only a touch above its all-time low.

We still expect a recession to be avoided, but the risk will weigh on the MPC's forthcoming decisions.

Samuel Tombs (UK Economist)U.K.

14 Apr 2022 CPI Inflation will Fall Next Year Almost as Sharply as it Has Climbed

We look for two further 25bp increases in Bank Rate this year, not one, after March's jump in CPI inflation.

CPI inflation looks set to peak at about 9% in April and remain above 8% until the very end of this year.

But energy and core goods inflation will plunge next year; the MPC needn't be as active as markets expect.

Samuel Tombs (UK Economist)U.K.

6 Apr 2022 Falling Health Sector Output Likely Caused GDP to Drop in February

Output in the consumer services sector recovered strongly in February, assisted by fading Covid fears.

...But output in the health sector likely fell considerably, due to sharp falls in Covid testing and vaccinations.

Manufacturing output was hit by a slump in car production, while building work was disrupted by storms.

Samuel Tombs (UK Economist)U.K.

5 Apr 2022 No Recession Signalled by Financial Market Indicators

The U.K. yield curve has not inverted and inversion is not a reliable bellwether of U.K. recessions.

Equity prices for consumer-facing companies have fallen sharply, but not yet to recession levels.

The oil price has been this high before without triggering a downturn, and GDP is less energy-intensive now. 

Samuel Tombs (UK Economist)U.K.

31 Mar 2022 Why are we the Only Forecasters Expecting GDP to Fall in Q2?

  • Most economists have overlooked the big drag on GDP growth ahead from falling Covid-related expenditure...
  • ...As well as the hit to output in June from the extra public holiday to celebrate the Queen's Diamond Jubilee.
  • We look for a 0.3% q/q decline in Q2 GDP, but a recession isn't likely; all the headwinds will ease in Q3.

Gabriella DickensU.K.

29 Mar 2022 The Momentum Behind the Recovery in Q1 won't be Sustained

  • The latest data suggest that GDP increased by 0.9% in Q1, despite the Omicron hit at the turn of the year...
  • ...But lower health spending, an extra bank holiday and falling real incomes will weigh on the recovery in Q2.
  • The MPC, therefore, likely will refrain from raising Bank Rate later this year, after a final hike to 1.00% in May.

Samuel Tombs (UK Economist)U.K.

18 Mar 2022 Markets Likely to be Caught on the Hop Again by the MPC's Dovishness

  • Markets' rate expectations fell sharply in response to the crumbling of hawkish dissent on the Committee.
  • The MPC now is more worried about the impact of high inflation on demand than on inflation expectations.
  • We continue to expect the MPC to stop hiking this year once Bank Rate has reached 1%.

Samuel Tombs (UK Economist)U.K.

15 Mar 2022 This Year's Trade Deficit will be the Largest Since the Late 1980s

  • January's record large trade deficit was not just due to erratic items; higher energy prices are partly to blame.
  • U.K. exporters also are continuing to lose market share; no reason to expect a turnaround this year.
  • Imports will continue to rise quickly, driven by higher energy prices and the recovery in outbound tourism.

Gabriella DickensU.K.

  Publication Filters

Change View: List   Small Grid  

Filter by Keyword

Filter by Publication Type

Filter by Author

Global Publications Only

Filter by Date
(6 months only; older publications available on request)

  Quick Tag Filters

Consistently Right
Access Key Enabled Navigation
Keywords for: U.K. Documents

U.K. Document Vault, Pantheon Macro, Pantheon Macroeconomics, independent macro research, independent research, ian shepherdson, economic intelligence