Research Briefing | Jan 27, 2022

United Kingdom: A February rate hike is on a knife-edge

United Kingdom | A February rate hike is on a knife-edge

Whether or not the MPC raises Bank Rate in February is close to a 50:50 call. We marginally favour a hike because Omicron’s economic damage appears modest, the jobs market has tightened and the MPC is likely to significantly revise up its inflation forecast.

What you will learn:

  • But signs of secular risks to inflation, particularly a wage-price spiral, are still missing.
  • And with pay growth having slowed, there’s good reason to think the inflation narrative will shift to a less disturbing direction in H2 2022.
  • With monetary policy operating over a multi-year horizon, we don’t see a pressing need for the MPC to hike in February.
Back to Resource Hub

Related Services

Post

Most US metros to see slower growth in 2024

Most metros have had steady GDP and job growth in 2023 but will start to see quarterly declines in Q4 or Q1 2024. All of the top 50 metros are forecast to see a slowdown in GDP growth in 2024, driven by lower finance and real estate GDP more than by other sectors.

Find Out More
Global: Why the real yield on private wealth will keep falling

Post

Why the real yield on private wealth will keep falling globally

Despite the importance of returns on private wealth for long-term investors – be they households, asset managers, or pension funds – the fact that real yields have been on a downward trend across the world for decades seems to have escaped attention.

Find Out More