Archive

April 28, 2025
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UK Politics: Labour Day, Not Labour’s Day

  • With the balance of how many seats Labour loses to Reform UK relative to the LibDems and Greens being potentially decisive in internal party wrangling, the outcomes of the 1 May local elections and a concurrent by-election stand to have a significant impact on government policy.

By Alastair Newton

April 23, 2025
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Global Manufacturers Shrug Off Tariffs

  • Volatile and destructive US trade policy has roiled markets and confidence, but April's flash PMI data suggests the sector isn’t suffering significantly more than before.
  • The average held steady while the US balance increased. Weakness concentrated in the UK, where experience of the past decade suggests it is more distorted by bad vibes.
  • Unemployment data are a more reliable signal, albeit lagging, and these also remain remarkably resilient. Rate cuts rely on Trump breaking the economy, but lack evidence.

By Philip Rush

April 16, 2025
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UK: Price War Dents Spring Inflation

  • A supermarket price war hit food prices, slowing UK CPI inflation below the headline consensus again. Upside news in clothing was offset by downside in game prices.
  • Repeating 2008’s experience would drive a game price rebound, but the food effect is more likely to persist. The median inflationary impulse should also rebound soon.
  • Unit wage costs remain inconsistent with the target, while energy and water utility bills will drive a massive jump in April. We still forecast a final 25bp BoE rate cut in May.

By Philip Rush

April 15, 2025
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UK: Green Shoots For Unemployment Wilt

  • Signs that statistical effects might lower the unemployment rate in the Spring have weakened, with stability at 4.4% now more likely amid stagnant underlying trends.
  • Levels remain healthy and redundancies are low despite falling vacancies, suggesting resilience survives rather than thrives. Rapid wage growth is more problematic.
  • Dovish hopes that excesses will break soon, aided by destructive US trade policy, keep the BoE on track to cut in May. Sterling strength also adds disinflationary space.

By Philip Rush

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