May 26, 2023
UK: Return to Flattened Trend in Apr-23
- UK retail sales in April 2023 showed an unexpected rebound with 0.5% m-o-m growth, outperforming the previous month's -1.2% contraction and beating the 0.3% consensus.
- This rise represents the highest growth rate since February 2023 and positions April's sales performance above the 1-year and long-run averages.
- It reinforces recent signs of recovery in the UK retail sector, breaking the downward trend and providing crucial insights into the economic landscape.
May 23, 2023
Services Requesting Rate Hikes
- The Flash PMIs diverge between manufacturing’s depression and rudely resilient services activity. It’s a similar story for the UK, EA, and US as they resist recession.
- Their unemployment rates are lower than a year ago, except in the UK, where there has been a slight rise of questionable statistical significance.
- Persistent excess demand is inconsistent with ending the inflation problem. We still expect another BoE hike and two from the ECB. Further Fed steps could extend that.
By Philip Rush
May 16, 2023
UK: Unemployment’s Second Slackening
- The UK unemployment rate increased by 0.1pp for the second consecutive month to 3.9% in Mar-23 as labour market levels rebounded further.
- Change is coming from an under-sampled area, raising the risk of statistical error. A fall in vacancies would corroborate this weakening if sustained.
- Total pay growth remains too rapid to be consistent with the inflation target and should encourage the BoE to hike by another 25bp in June.
By Philip Rush