UK Economy
Another month, another adverse inflation result
This morning’s UK consumer price inflation (CPI) result further weakens the case for easing this year until there is evidence that disinflation has resumed. Prices grew faster than...
Growth outperforms forecasts again in Q2
Despite widespread expectations that the UK economy would struggle this year as a result of Labour’s Budget last autumn, growth has been stronger than expected in the first half of...
A hawkish Bank Rate cut after an unprecedented second vote
As it did in August last year, the Bank of England’s Monetary Policy Committee (MPC) voted narrowly for a cut to Bank Rate. This is despite solid economic growth, above-target inflation...
Faster June inflation weakens the case for two rate cuts in H2
UK inflation was rapid in June, especially for core inflation which grew 0.4% compared to May and double the consensus expectation of 0.2%. In annual terms, overall and core inflation of...
Services inflation rises back above 5% in April
As the Bank of England has long been pre-occupied with price changes for services, April’s 5.4% annual result will encourage a more hawkish direction for Bank Rate. Market pricing has...
Slower UK inflation paves the way for a rate cut in May
UK inflation declined to 2.6% in March. While still above target, the Bank of England is likely to take comfort from a slower path for services inflation compared to its latest forecast. A...
February GDP gains from a pre-tariff manufacturing boost
While growth in February’s GDP was well above expectations, this was driven by a pre-tariff manufacturing boost. Despite an otherwise hawkish backdrop, we now expect the Bank of...
Government banking on growth to avoid future welfare cuts
There were few surprises in the Spring Statement as weaker growth and higher borrowing costs limited the Chancellor’s scope for new policies. Well-flagged adjustments to last...
Services disinflation boosts the case for Bank Rate cuts in 2025
UK inflation declined marginally in December, helped by services price disinflation. This marks an improvement on recent months, especially for a subset of non-volatile services (excluding...
Invest, invest, invest: Labour’s plan to restore UK growth
Labour’s first Budget since 2010 was delivered this afternoon by Chancellor Rachel Reeves. Higher investment has been facilitated by a new fiscal rule targeting a broader measure of...
