UK Economics Weekly Interest rate hikes and the two-speed economy The impending interest rate hikes from the Bank of England may exacerbate the two-speed economy by weighing on consumer spending by more than business investment. So over the next year or so, the... 30th October 2026 · 4 mins read
UK Economics Weekly French bond rout raises the stakes for the UK Budget Recent developments in the French bond market strengthen the case for a prudent UK Budget on Wednesday. But the government still has room to act. We expect some temporary cost-of-living support and... 23rd October 2026 · 3 mins read
UK Economics Weekly Global headwinds threaten UK’s economic resilience While the economy has shown remarkable resilience to higher energy prices and borrowing costs so far this year, we still think the coming rise in inflation will lead to an easing in GDP growth from 1... 16th October 2026 · 8 mins read
UK Economics Weekly When should Burnham call a general election? To the extent that the economy matters in determining the timing of general elections and their result, our economic forecasts and the government's tax and spending plans imply that 2028 looks like a... 9th October 2026 · 5 mins read
UK Economics Weekly Diesel price risk, triple lock trickery, and an EU reality check A ban on US exports of diesel could raise UK diesel prices from £2 a litre to £3 a litre and mean CPI inflation peaks at just above 5% instead of just above 4%. Meanwhile, the change to the triple... 2nd October 2026 · 5 mins read
UK Economics Weekly Is the UK’s productivity malaise ending? The recent revival in productivity seems to be driven by weaker growth in hours worked, rather than stronger GDP growth or a widespread AI-related boost. As a result, we think it’s too soon to... 25th September 2026 · 4 mins read
UK Economics Weekly Higher mortgage rates to squeeze households for longer The revisions to our forecasts this week mean the drag on activity from higher mortgage rates will be a bit bigger and last longer than we previously thought. This adds to our view that the coming... 18th September 2026 · 4 mins read
UK Economics Weekly Can the BoE stay on hold while the ECB and Fed hike? As the Bank of England’s situation is a bit different to the Fed’s and the ECB’s, it is possible for the Bank to go it alone and not raise interest rates. The risks to that forecast, though, are one... 11th September 2026 · 7 mins read
UK Economics Weekly Global developments dampen PM’s policy ambitions The latest rises in gilt yields and UK market interest rate expectations have reduced Chancellor Healey’s headroom against his main fiscal rule from £23.6bn in March to around £15.0bn. And higher... 4th September 2026 · 5 mins read
UK Economics Weekly Food inflation will soon be back on the menu The recent marked easing in food price inflation won’t last long as it’s only a matter of time before the rise in global agricultural commodity prices feeds into the prices on the supermarket shelves... 28th August 2026 · 4 mins read
UK Economics Weekly Indirect inflation effects will take time to unfold The absence so far of first-round indirect energy effects on inflation tells us little about the extent of the rise in inflation to come. But the latest evidence provides a bit more reassurance that... 21st August 2026 · 3 mins read
UK Economics Weekly Heatwaves pose bigger risks to inflation than activity Heatwave-related impacts on near-term activity are likely to be sector-specific, short-lived, and therefore have only a small influence on aggregate GDP. This summer’s scorching temperatures pose a... 14th August 2026 · 8 mins read
UK Economics Weekly Manufacturing revival not just a stockbuilding story After four years of near-continuous contraction, the industrial sector is getting back on its feet. While this revival largely reflects the temporary prop from precautionary stockbuilding after the... 7th August 2026 · 5 mins read
UK Economics Weekly Probability of BoE interest rate hikes may be starting to shrink Despite the Bank of England maintaining its hiking bias on Thursday, it feels as though the Bank is edging further away from interest rate hikes as it comes round to our view that the weak labour... 31st July 2026 · 4 mins read
UK Economics Weekly Two mounting upsides to our inflation and interest rate forecasts The recent rebound in oil and gas prices and the prospect of looser fiscal policy under the new Burnham government suggests the risks to our forecast for GDP to grow by 1.0%, CPI inflation to fall to... 24th July 2026 · 4 mins read
UK Economics Weekly Burnham inherits economic resilience that won’t last The recent resilience of the UK economy is unlikely to last in the second half of the year when the full effects of higher energy prices are felt. Further ahead, Andy Burnham is unlikely to achieve a... 17th July 2026 · 10 mins read
