Pantheon Macroeconomics

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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.

July

15 Sept 2021 Wages Likely Won't Match Inflation as Slack Builds Post-Furlough

  • Payroll employee numbers returned in August to their pre-Covid peak, but will dip in Q4, after furlough ends.
  • We expect the unemployment rate to rise to 5.0% in Q4, from 4.5% in Q3; slack within firms will build too.
  • Three-month-on-three-month annualised growth in wages fell to 3.2% in July; slack will keep it in check.

samuel tombs (UK Economist)U.K.

UK Datanote: U.K. Labour Market Data, July & August 2021

  • In one line: Not yet tight enough for strong underlying wage growth; slack to increase in Q4.

samuel tombs (UK Economist)U.K.

13 Sept 2021 Covid Put the Brakes on July GDP; Expect a Lingering Drag This Year

  • Surging Covid-19 cases largely were responsible for the near-stagnation of GDP in July.
  • The virus no longer is driving labour shortages, but many remain fearful and will spend less if it picks up.
  • We still look for quarter-on-quarter growth in 1.5% in Q3, half the rate expected by the MPC.

samuel tombs (UK Economist)U.K.

UK Datanote: U.K. International Trade, July 2021

  • In one line: U.K. trade still failing to benefit from global upswing. 

samuel tombs (UK Economist)U.K.

UK Datanote: U.K. GDP July 2021

  • In one line: Stagnation due largely to resurgent Covid; timelier data point to a renewed recovery in August.

samuel tombs (UK Economist)U.K.

10 Sept 2021 Hidden Slack will Rise More than the Unemployment Rate, Post-Furlough

  • The number of workers on furlough decreased again in July, as government contributions were tapered...
  • ...But usage remains high in sectors that already have fully recovered, and among financially-weak SMEs.
  • We expect the unemployment rate to rise to 5.0% in Q4, from 4.5% in Q3; hidden slack will rise much more.

samuel tombs (UK Economist)U.K.

9 Sept 2021 What Does the Latest Surge in Energy Prices Mean for CPI Inflation?

  • The MPC's energy price assumptions for its inflation forecast are too high in the near-term, and for 2023.
  • Wholesale electricity and natural gas price changes don't immediately impact the CPI...
  • ...Future prices still imply that Ofgem will lower slightly the default tariff cap next year, not raise it further.

samuel tombs (UK Economist)U.K.

7 Sept 2021 July GDP to Undershoot the Consensus with a No-Change Print

  • GDP likely held steady in July, falling short of the consensus and the level implied by the BoE's Q3 forecast.
  • Surging Covid cases depressed output in the distribution, food services and education sectors.
  • A decline in new Covid-19 vaccinations probably led to a reduction in output in the health sector too. 

samuel tombs (UK Economist)U.K.

6 Sept 2021 Forecast Review: The Consensus is Still too Upbeat on Q3 GDP

  • From now on, the U.K. Monitor on the first Monday of each month will summarise recent forecast changes.
  • We now think GDP flatlined in July, so our Q3 fore- cast, 1.5% q/q, is well below the consensus, 2.4%.
  • Our 3.7% forecast for the CPI inflation in Q4—probably the peak—is below the MPC's new 4.0% estimate.

samuel tombs (UK Economist)U.K.

3 Sept 2021 Why is the U.K.'s Recovery Still Lagging Behind the Eurozone's?

  • The U.K. economy was hit harder by the pandemic and has struggled to catch up to the Eurozone since.
  • Britain's faster rollout of vaccines led many to assume that it would close the gap with the Eurozone in Q3...
  • ...But near-real-time indicators imply Q3 GDP growth actually was stronger in the Eurozone than the U.K.

samuel tombs (UK Economist)U.K.

1 Sept 2021 Households are Prioritising Debt Repayments Over Having Fun

  • Households' stock of excess savings rose in July to 8.3% of 2020 GDP, after another cautious month.
  • The proportion of credit card debt repaid rose to a record high; ad hoc mortgage payments were high too.
  • Businesses aren't borrowing either, though capex still looks set to recover from rock-bottom levels in 2022.

samuel tombs (UK Economist)U.K.

UK Datanote: U.K. Money & Credit, July 2021

  • In one line: Households remain stuck in a cautious mindset.

samuel tombs (UK Economist)U.K.

31 Aug 2021 Renewed Consumer Caution Likely as Covid-19 Cases Rise Further

  • Covid-19 cases will rise at a faster rate in September, as schools return and vaccine efficacy fades.

  • The government is puzzlingly lukewarm on booster jabs; admissions will be much higher by October.
  • Renewed business closures are unlikely, but the re- covery's pause in July shows people still fear Covid

samuel tombs (UK Economist)U.K.

26 Aug 2021 Labour Shortages will be a Long- Lasting Constraint on GDP

  • Businesses are reporting low inventory in relation to demand, but shops remain well-stocked for now.
  • Labour shortages should fade now that self-isolation rules have eased and the holiday season is nearly over.
  • The workforce, however, is 2.2% below its pre-Covid trend; migration and participation won't fully recover.

samuel tombs (UK Economist)U.K.

24 Aug 2021 The Belated Shift Down in the PMIs Highlights a Drawn-out Recovery

  • August's sharp fall in the composite PMI brings it in line with other indicators, which weakened in July.
  • In fact, GDP likely rose at a faster rate in August than July, though it won't match its peak until year-end. 
  • Output prices reportedly rose at a slower pace in August, tentatively supporting the "transitory" take.

samuel tombs (UK Economist)U.K.

23 Aug 2021 Setting the Record Straight on Why Retail Sales Fell in July

  • The Delta variant is to blame for July's fall in retail sales, not the rain, zeal for dining out, or alleged shortages.
  • Surveys show households were less willing to visit both shops and services providers last month.
  • Retailers are unlikely to benefit from any future recovery in consumers' confidence.

samuel tombs (UK Economist)U.K.

UK Datanote: U.K. Public Finances, July 2021

  • In one line: Still undershooting the OBR’s expectations, but progress soon will slow.

samuel tombs (UK Economist)U.K.

UK Datanote: U.K. Retail Sales, July 2021

  • In one line: Decline due to the Delta wave; underlying trend in H2 will be broadly flat.

samuel tombs (UK Economist)U.K.

19 Aug 2021 CPI Base Effects Distract from July's Slowing in Core Price Rises

  • The pace of month-to-month increases in consumer prices slowed in July; the re-opening surge is over.
  • CPI inflation still is set to rise sharply, but the peak will be a bit below the 4% rate expected by the MPC...
  • ...The MPC's food and energy price assumptions are too high, while goods inflation will fall swiftly next year.

samuel tombs (UK Economist)U.K.

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