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.

consumer goods

7 Dec 2021 Real-Time Data Show Clear Hit to Services Firms from Omicron

  • Omicron fears already have led people to travel and visit restaurants, shops and cinemas less often.
  • Booster jabs are containing hospital admissions, but people still have good reasons to avoid being infected.
  • While boosters and school holidays will weigh on cases, Omicron and Christmas festivities will keep R>1.

Samuel Tombs (UK Economist)U.K.

3 Dec 2021 If Omicron Were Vaccine-Resistant, What Would the MPC do Next?

  • The MPC would ease monetary policy again in the unlikely event that another lockdown is imposed.
  • Fiscal policy would be less supportive than in previous lockdowns; new curbs would dampen inflation.
  • Negative rates are in the toolkit and are preferred to more QE; Bank Rate likely would be cut to -0.25%.

Samuel Tombs (UK Economist)U.K.

30 Nov 2021 Does October's Low Saving Signal Households' Mindset has Changed?

  • Households last month saved the least and borrowed the most for consumption since the pandemic began...
  • ...People are maintaining their spending while real incomes are falling; they aren't bingeing.
  • Firms continued to repay external finance in October, but this isn't necessarily a bad sign for investment.

Samuel Tombs (UK Economist)U.K.

29 Nov 2021 Forecast Review: MPC Caught Between Higher Inflation and Omicron

  • Recent activity data have surprised to the upside, but the Omicron variant casts a shadow over Q1.
  • The near-term path for inflation looks much higher than a month ago, after October's above-consensus data.
  • The MPC likely will hike Bank Rate in December, but markets' expected 2022 rate path looks far too steep.

Samuel Tombs (UK Economist)U.K.

26 Nov 2021 Could Europe's Covid Wave Enfeeble Britain's Recovery?

  • The fast rollout of boosters has reduced U.K. hospital admissions, whereas they are surging across Europe.

    Economic contagion for the U.K. in the event of fresh restrictions in the rest of Europe should be modest.

    Manufacturing output would be unaffected, while the weaker euro will help to lower U.K. CPI inflation in 2022.

Samuel Tombs (UK Economist)U.K.

22 Nov 2021 Q4 Retail Sales won't be Stellar, Despite October's Good Start

  • October's rise in retail sales volumes was driven solely by people buying Christmas presents earlier than usual.
  • Consumers' confidence recovered in November, but still is below-average, and will drift down over the winter.
  • A large minority of people remain fearful of Covid; rising cases likely will instil greater caution over the winter.

Samuel Tombs (UK Economist)U.K.

18 Nov 2021 October's CPI Data Tip the Scales Towards a December Rate Hike

  • October's 4.2% rate of CPI inflation was well above the MPC's 3.9% forecast; such a large error margin is rare.
  • The upside surprise came from the core, and will carry over to future months; April's peak looks set to top 5%.
  • Mean-reversion in energy and goods prices, however, should ensure that CPI inflation dips below 2% in 2023.

Samuel Tombs (UK Economist)U.K.

UK Datanote: U.K. Consumer Prices, October 2021

  • In one line: Above the MPC’s forecast again; a 5% peak lies ahead.

Samuel Tombs (UK Economist)U.K.

16 Nov 2021 Exports are Still in the Doldrums; Brexit Clearly is to Blame

  • U.K. exports in Q3 were 14% below their 2018 average, a larger shortfall than in any other G7 economy.
  • It's not just services exports; U.K. goods exports are well below their pre-Covid level; Brexit is to blame.
  • Several potential further headwinds loom, including the risk of further trade barriers from the EU.

Gabriella DickensU.K.

15 Nov 2021 October's CPI Inflation Print Likely Will Exceeded the Consensus

  • Energy prices likely were the key driver of higher CPI inflation in October, but the core rate probably rose too.
  • Used car prices rocketed again, while data from the BRC point to a chunky rise in clothing prices.
  • Hospitality firms probably raised prices in response to the VAT hike; the boost is uncertain but likely large.

Samuel Tombs (UK Economist)U.K.

12 Nov 2021 Weak GDP Growth in Q3 Leaves the U.K. as the G7's Straggler Again

  • U.K. GDP was 2.1% below its Q4 2019 level in Q3, exceeding the shortfalls seen in other G7 counties.
  • Households have continued to spend more cautiously than those abroad; high virus levels are partly to blame.
  • Brexit also has contributed to the continued underper- formance; exports were 17% below their 2019 average.

Samuel Tombs (UK Economist)U.K.

2 Nov 2021 Households won't Abandon their Cautious Mindset Anytime Soon

  • Households continued in September to save more and borrow less than they did before Covid.
  • The recovery in spending will continue only if households save less in response to falling real incomes...
  • Households did this in 2016, but are less confident now, despite having a larger precautionary buffer.

Samuel Tombs (UK Economist)U.K.

1 Nov 2021 Forecast Review: Rate Hikes Loom Closer, But Not This Week

  • The near-term outlook for GDP has worsened, but 2022 looks a little brighter in the wake of the Budget.
  • Higher energy prices mean we have revised up our forecast for CPI inflation in 2022 to 3.6%, from 3.4%.
  • We now expect two rate hikes, not one, in the next 12 months, but still anticipate no change this week.

Samuel Tombs (UK Economist)U.K.

25 Oct 2021 Where Does Last Week's Data Deluge Leave the MPC?

  • Markets are pricing-in a 65bp rise in Bank Rate by March and expect the first hike to come next week...
  • ...But falling consumer confidence, low pay settlements and rising Covid cases strengthen the case for patience.
  • November is "live", but markets' conviction is too strong; potential swing voters on the MPC have been very

Samuel Tombs (UK Economist)U.K.

21 Oct 2021 Plenty of Ammo for the MPC's Doves in September's CPI Report

  • The MPC's preferred measure of underlying services inflation merely matched its 2010s average in September.
  • CPI inflation is on course to rise to a peak of about 4.8% in April, from 3.1% in September...
  • ...But the rise will be driven largely by higher energy prices; core inflation should remain well-behaved.

Samuel Tombs (UK Economist)U.K.

18 Oct 2021 September's CPI Data will be the Calm Before the Storm

  • CPI inflation likely was unchanged in September from August's 3.2% rate.
  • Used car prices have surged again, while surveys point to retailers increasing prices faster than usual...
  • ...But motor fuel prices rose only slightly, and accom- modation and food services inflation likely fell back.

Samuel Tombs (UK Economist)U.K.

14 Oct 2021 Recovery Sluggish Even Prior to the Withdrawal of Fiscal Support

  • August's 0.4% m/m rise in GDP sets it up for a 1.5% q/q rise in Q3, below the 2.1% expected by the MPC.
  • Health sector output probably rebounded in September, but the "staycationing" boost likely faded.
  • We're lowering our Q4 GDP forecast to 1.0% q/q, from 1.2%; fiscal, fuel and energy headwinds are strong.

Samuel Tombs (UK Economist)U.K.

12 Oct 2021 How Much Weight will the MPC Place on Inflation Expectations?

  • Markets see a 50% chance of the MPC hiking Bank Rate next month; December viewed as a done deal.
  • November still seems too early; the MPC saw "a high option value" in waiting for post-furlough jobs data.
  • Inflation expectations exceed the rate implied by current inflation, but this residual isn't a reliable wage signal.

Samuel Tombs (UK Economist)U.K.

6 Oct 2021 Net Trade will Return to Depressing GDP Growth Next Year

  • Revisions to Q2 GDP data brightened the picture of the economy's recent trade performance...
  • ...But Brexit still is preventing U.K. exporters from benefiting fully from the upswing in global trade.
  • The return of the structural deficit in services trade will cause net trade to weigh on GDP growth in 2022.

Samuel Tombs (UK Economist)U.K.

4 Oct 2021 Forecast Review: One Rate Hike in 2022 Now Looks Likely

  • We have lowered our forecast for Q4 GDP, due to the impaired supply of fuel and industrial inputs.
  • Surging energy prices have forced us to hike our forecast for CPI inflation in 2022 to 3.4%, from 2.5%.
  • We now expect the Committee to hike Bank Rate in Q2 2022, but we don't buy investors' hawkish view.

Samuel Tombs (UK Economist)U.K.

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