Archive

November 24, 2025
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UK Labour Party: Damned If They Do…

  • Whatever Rachel Reeves comes up with in her 26 November budget, she is bound to run into criticism from within her own parliamentary party.
  • Bond markets seem set to react badly to this, especially if it seems likely that her overall objectives will be undermined by internal resistance to proposed measures.
  • She and the PM will probably survive this, but a market-unsettling change and slide to the left look increasingly likely by mid-2026, followed by defeat at the next election.

By Alastair Newton

November 20, 2025
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US: Resilient Into Shutdown

  • US payroll data revealed resilience going into the US government shutdown, with jobs growth the strongest since April and annualising to a pace capable of plateauing growth.
  • Surging labour force participation drove unemployment up in the least disappointing way, with the employment to population ratio making a contradictory improvement.
  • Jobless claims suggest stability into the shutdown’s end, besides noisy federal claims. The FOMC may not get the evidence it needs to cut again in December. It may not exist.

By Philip Rush

November 19, 2025
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UK Disinflationary Kool-Aid

  • UK disinflation relied on smaller utility price hikes and only went as far as the 3.6% forecast before September’s dovish surprise. It does not mean a path to 2% lies ahead.
  • A broad rebound in price increases took the annualised median impulse above 4% to average 2.5% over two months, or 3% on the year, as the underlying problem persists.
  • The BoE’s December decision pivots around the Governor, who seemingly needs upside news to avoid delivering a cut, so this outcome preserves that riskily dovish course.

By Philip Rush

November 19, 2025
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EA: Unsatisfying disinflationary snack

  • Slower food price inflation nibbled the EA rate down to 2.1% in October, while services increased to their fastest pace since April. Labour costs are still rising too fast.
  • Underlying inflation metrics are broadly a bit beyond target, risking a slight overshoot in the medium term, but the median impulse is reassuring, weighed down by France.
  • Energy prices are set to bump inflation around the target in 2026, averaging above the consensus in our view. The ECB would need tightness elsewhere to shift rates, though.

By Philip Rush

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