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 email@example.com, or contact your account rep
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- Markets now are completely convinced the MPC will hike Bank Rate in Q1...
- ...But activity data keep surprising to the downside, and the end of the furlough scheme will release slack.
- Households' inflation expectations have picked up, but the MPC has downplayed their importance.
- The ONS estimates that underlying year-over-year growth in wages was between 3.6% and 5.1% in July...
- ...We expect an increase in labour market slack, post-furlough, to push this rate down to about 3.2%.
- Employers will pass on higher NICs rates to staff, while public sector pay will rise only modestly next year.
- Public borrowing in August was only slightly below the OBR's forecast; interest payments are picking up.
- We think the OBR will revise its long-term "scarring" estimate only to 2.5%, from 3.0% previously...
- ...The workforce has continued to contract this year, confounding the OBR's hopes of a rebound.
- August's drop in retail sales was broad-based; the recovery in overall spending now is sluggish.
- Real disposable income will drop by 1.5% q/q in Q4, as employment falls, inflation soars, and benefits are cut.
- RHDI will recover in Q1, but then flatline in Q2, in response to the rise in employees' NICs rates.
Markets now expect the MPC to raise Bank Rate twice next year, with the first hike as soon as February.
The MPC, however, will focus on labour market slack and the prospects for its elimination, not just inflation.
The recovery has faded, implying many furloughed staff will be underemployed in Q4; the MPC needn't rush.
- Year-over-year growth in house prices slowed in July, following the tapering of government support.
- Expect a further slowdown in Q4, when the SDLT threshold will return to £125K and real incomes will fall.
- The outlook for 2022, however, is brighter; falling mortgage rates and tight supply will support prices.
- The month-to-month rise in the core CPI in August was only 0.1pp bigger than the average in the 2010s.
- Used cars and computer games drove the large monthly gain; no sign of broad-based price increases.
- Higher energy prices will push up the headline rate to 4% in Q4 and Q1, but the MPC needn't blink.
- 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.
- In one line: Not yet tight enough for strong underlying wage growth; slack to increase in Q4.
- We think CPI inflation leapt to 3.1% in August, from 2.0% in July, above the 2.9% consensus.
- Core inflation likely jumped on the anniversary of the Eat Out to Help Out Scheme...
- ...But it also probably was boosted by abnormally large increases in used car and other goods prices.
- 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.
- 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.
- Markets still expect the MPC to hike rates in Q2 2022, despite surprise plans to lift national insurance in April.
- The tax hike will defer a full recovery in households' spending to the second half of next year.
- The plans imply the Treasury does not expect the OBR to turn upbeat on the medium-term economic outlook.
- 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.
- 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.
- The margin by which public borrowing undershoots the OBR's forecast will narrow over coming months...
- ...Interest payments will soar, while GDP growth in Q3 and Q4 will fall short of the OBR's expectations.
- The OBR's scarring judgement looks sound; productivity and participation have been lower than expected.
- 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.
- Employee numbers have rebounded since the spring, but total employment is lagging behind.
- Vacancies are high, but are concentrated in different sectors to those which will see post-furlough layoffs.
- High inflation and 4-to-5% unemployment didn't lift wage growth in 2017, and probably won't this time.
- In one line: Recent employment gains likely will be reversed when the furlough scheme ends.
- CPI inflation probably declined to 2.1% in July from 2.5% in June, below the consensus, 2.3%.
- Clothing prices appear to have fallen sharply, as usual; they dropped only marginally a year ago.
- Surveys suggest the pace of increases in catering services prices has slowed down.