UK | The economy continues to claw back Covid losses
The UK economy made more progress in August in returning to its pre-Covid size. But supply-side friction and pressure on spending power from higher inflation point to a more sluggish growth period ahead.
What you will learn:
- Still, as the recent very strong set of labour market numbers demonstrates, the recovery is far from out of steam.
- Meanwhile, comments from MPC members suggest that opinions over future policy direction remain split. Upward revisions to Q2’s national accounts had left the economy closer to its pre-crisis size than initially thought.
- Last week’s GDP release for August saw that gap narrow further. In August, the first full month after most remaining domestic Covid restrictions were lifted on July 19, output rose 0.4% m/m.
Tags:
Related Services
Post
Nowcast shows wage growth slowing sharply
Our sentiment data, developed with Penta, suggests that UK private sector wage growth slowed sharply in March and early-April. If official data mirrors our sentiment indicator, it should keep the Monetary Policy Committee on track to cut interest rates in the summer.
Find Out More
Post
The euro and depreciation – shake, shake it off
Our new forecast assumes a slower euro appreciation against the dollar over the coming years than we previously anticipated. Relative productivity, terms of trade, and the current account will likely be less supportive of the euro than we thought. In addition, a stronger stock market than initially envisaged will attract more financial flows into the US than we had expected.
Find Out More