UK Publications
Below is a list of our UK Publications for the last 6 months. If you are looking for reports older than 6 months please email info@pantheonmacro.com, or contact your account rep
Please use the filters on the right to search for a specific date or topic.
Daily Monitor Rob Wood (Chief UK Economist)
- The October 30 Budget will likely boost government spending more than taxes, raising growth.
- Tax hikes will pay for day-to-day spending, while Ms. Reeves will tweak her fiscal rule to boost investment.
- Markets will be unruffled, so gilt yields could fall as any additional sovereign risk premium unwinds.
Rob Wood (Chief UK Economist)UK
- The decline in CPI inflation in September likely leaves Governor Bailey primed for “aggressive” rate cuts.
- But the fall in services inflation was exaggerated by volatile airfares; the MPC likely will look through this.
- We still expect the MPC to cut rates quarterly, but a consecutive cut in December is a close call now.
Rob Wood (Chief UK Economist)UK
- The official labour-market data tell a comforting story of improving labour supply and falling wage growth.
- But the LFS data are too unreliable to take seriously, and AWE seems to exaggerate the slowdown in pay.
- The MPC has enough to cut rates in November, but the data fog will restrict easing to once per quarter.
Rob Wood (Chief UK Economist)UK
- We expect a stimulatory Budget from Chancellor Rachel Reeves on October 30.
- A growth-boosting Budget should limit the MPC to cutting interest rates only once per quarter.
- Markets will be unruffled by a modest change to Ms. Reeves’ fiscal rules, so gilt yields could fall.
Rob Wood (Chief UK Economist)UK
- Disposable income surged 2.8% in H1 2024, but consumer spending rose only 0.8%.
- We expect the resulting jump in the saving rate to reverse through 2025, supporting consumption.
- Disposable income growth will slow, but remain solid at 1.3% year-over-year in 2025.
Rob Wood (Chief UK Economist)UK
- CPI inflation likely fell to 1.9% in September, from 2.2% in August, 0.2pp below the MPC’s forecast.
- All of the undershoot relative to the MPC’s call is accounted for by falling motor fuel prices.
- CPI services inflation will likely slip 0.2pp to 5.4%, as a hotel price jump partially offset a fall in airfares.
Rob Wood (Chief UK Economist)UK
- September business surveys suggest a hiring pause ahead of the October 30 Budget.
- We assume unchanged payrolls month-to-month in September and the August jobless rate held at 4.1%.
- The DMP and PAYE pay point to a 0.6% month-to-month private-sector ex-bonus AWE gain in August.
Rob Wood (Chief UK Economist)UK
- We expect GDP to rise 0.2% month-to-month in August, as retail sales grow and doctors’ strikes end.
- Manufacturing output should also rebound from erratic weakness in July.
- We look for Q3 growth of 0.3% quarter-to-quarter, but GDP revisions pose a downside risk.
Rob Wood (Chief UK Economist)UK
- Sharply falling motor fuel prices will drag down CPI inflation to 1.9% in September, from 2.2% in August.
- Core goods inflation should hold at 0.3% year-over-year, but BRC Shop Prices pose a downside risk.
- We expect core and services inflation close to theMPC’s August Monetary Policy Report forecast.
Rob Wood (Chief UK Economist)UK
- Q2 GDP growth was revised down to 0.5% quarter-to-quarter, but the mix of growth is better…
- …Business capex growth was revised up and cuts to the saving rate signal less cautious consumers.
- Surging mortgage approvals show consumers are responding quickly to the MPC’s interest rate cut.
Rob Wood (Chief UK Economist)UK
- A suite of Taylor rules forecasts Bank Rate between 3.4% and 4.3% at the end of 2025.
- These forecasts are based on MPC inflation and growth projections, which we think are too low.
- Policy rules that are more robust to uncertainty about the neutral rate suggest more gradual cuts.
Rob Wood (Chief UK Economist)UK
- A Chancellor scrabbling for tax revenue will likely turn to alcohol and tobacco duty hikes.
- We expect Ms. Reeves to raise tobacco duty—by 4% above RPI inflation—and alcohol duty in December.
- Our forecasts include a 10% private-school fee hike, split September 2024, January and September 2025.
Rob Wood (Chief UK Economist)UK
- We expect house price inflation to accelerate to 4.5% year-over-year in December.
- MPC rate cuts, solid wage growth and low unemployment will drive that housing rebound.
- Forward-looking indicators suggest upside risk; they point to 6% year-over-year house price gains.
Rob Wood (Chief UK Economist)UK
- The composite PMI decline and drop in output price inflation raise the potential for faster rate cuts.
- But the PMI remains consistent with 0.4% quarter-to-quarter GDP growth…
- ...While still-strong forward-looking sub-balances suggest the headline PMI will rebound.
Rob Wood (Chief UK Economist)UK
- The MPC kept Bank Rate on hold, as expected, but the 8-to-1 vote was less dovish than expected.
- The MPC signalled a gradual rate-cutting cycle, which suggests to us one cut per quarter.
- We expect the MPC to cut Bank Rate by 25bp in November and again in February.
Rob Wood (Chief UK Economist)UK
- Underlying services inflation pressures continue to ease, so the MPC will cut rates again this year.
- But August’s CPI inflation gives the MPC little reason to rush to cut today; it will wait until November.
- Core CPI inflation jumped to 3.6% in August, which we think was close to the MPC’s expectation.
Rob Wood (Chief UK Economist)UK
- Consumer confidence has provided a reliable signal of consumer spending for 50 years.
- Confidence points to consumption strengthening and unemployment falling.
- Consumers’ saving intentions are high but they provide little useful signal about actual saving.
Rob Wood (Chief UK Economist)UK
- The OBR has again deemed the public finances to be on an unsustainable trajectory.
- Climate-change mitigation and an ageing population will be costly for the exchequer.
- Lifting productivity growth is crucial for ensuring the debt burden remains manageable
Rob Wood (Chief UK Economist)UK
- We expect the MPC to vote 7-to-2 to keep Bank Rate on hold at next week’s policy meeting.
- Rate-setters will note slowing inflation supports faster cuts but a solid labour market suggests caution.
- The MPC will signal further rate cuts are likely, but that policy will need to stay sufficiently restrictive.
Rob Wood (Chief UK Economist)UK
- A second consecutive month of unchanged GDP gives little reason for worry.
- GDP was depressed by erratic sectors; they will rebound, and surveys point to robust growth.
- So, the MPC will still wait until November to cut interest rates again despite the downside GDP surprise.
Rob Wood (Chief UK Economist)UK
