UK Economic Forecast
March 3, 2020The economy flatlined in the final quarter of 2019 according to recent data, amid a contraction in fixed investment and soft private consumption. In contrast, the external sector contributed strongly to growth, although this was likely due in part to temporary factors flattering exports. Turning to 2020, available indicators suggest a stronger start to the year. Both the manufacturing and services PMIs averaged notably higher in January–February compared to Q4, amid a reduction in political uncertainty following the elections, while retail sales rebounded in January. However, PMI survey respondents highlighted that the COVID-19 outbreak had dampened demand from Asia, and the virus will likely continue weighing on the external sector in the months ahead. In politics, the UK and EU began formal trade talks on 2 March. The talks are set to prove difficult, with areas such as fishing rights and the UK’s ability to diverge from EU regulations likely to be particular sticking points.
United Kingdom Economic GrowthGrowth should be modest this year. While a more expansionary fiscal stance should support activity, uncertainty over the future UK-EU trading relationship will cap business investment, while the coronavirus outbreak will weigh on exports. A possible unravelling of trade negotiations with the EU and a worsening of the viral outbreak pose downside risks. FocusEconomics panelists project GDP growth of 1.0% in 2020, which is unchanged from last month’s forecast, and 1.4% in 2021.
United Kingdom Economy Data
5 years of United Kingdom economic forecasts for more than 30 economic indicators.
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United Kingdom Facts
|Bond Yield||0.83||-3.04 %||Jan 01|
|Exchange Rate||1.33||-0.35 %||Jan 01|
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United Kingdom Economic News
March 26, 2020
In two emergency meetings in March, the BoE cut the Bank Rate from 0.75% to a record low of 0.10%, and announced it would increase its stock of investment-grade corporate bonds and UK government bonds from GBP 445 billion to GBP 645 billion.
March 25, 2020
Consumer prices rose 0.4% month-on-month in February, contrasting January’s 0.3% decline.
United Kingdom: Flash PMI data shows record deterioration in business activity in March; worse is still to come
March 24, 2020
The IHS Markit/CIPS UK services Purchasing Managers’ Index (PMI) fell from 53.2 in February to 35.7 in March, moving below the threshold that separates expansion from contraction in activity.
March 17, 2020
The unemployment rate ticked up to 3.9% in November–January, although employment continued to soar, up by 184,000 quarter-on-quarter and beating analysts’ expectations.
March 11, 2020
Industrial production fell 0.1% in January compared to the prior month, contrasting December’s 0.1% increase.