UK Economy

The British Pound's initial reaction was to go higher following the release of a UK labour report that roundly trounced analyst expectations and suggested the UK would continue to see elevated inflation levels as a result of elevated wage settlements.

Capital Economics has reviewed its mortgage forecasts and can reveal the hit to borrowers posed by a higher Bank of England base rate is likely to be "more severe" than initially anticipated with some facing a 50% jump in mortgage rates over the coming months.

The consensus was too gloomy on the UK's economic prospects entering 2023, but one investment bank now accuses economists of being too benign on the prospects of a recession later in the year.

UK house prices are forecast to fall further with one economist saying a near-10% decline can be expected from here.

One of the UK's largest high street lenders says the recent rise in UK core inflation in April represents a "game-changer" moment for UK interest rates and the broader economic outlook.

UK retailers are shedding jobs at the fastest rate since the recession of 2009 in a sign slack is starting to build in labour force, however the Bank of England won't welcome findings price rises are expected to continue at an elevated price into May.

The Bank of England is expected to hike interest rates on a further three occasions according to market-based expectations following the release of inflation data that was stronger than analysts were expecting.

Sentiment among manufacturers deteriorated and output volumes fell moderately in the three months to May, according to the CBI's latest Industrial Trends Survey.

Headline UK inflation has fallen back sharply when compared to a month ago, but the fall was not great enough to undershoot market expectations, leaving the Pound supported.

UK Public Sector Net Borrowing experienced an unexpected rise in April, reaching £24.74 billion, up from £20.02 billion in March.

Holger Schmieding, Chief Economist at Berenberg Bank, believes that UK consumers can anticipate a more favourable year ahead as inflation subsides and real wage growth turns positive.

Rentola, a property rental site, has released recent data highlighting a 4.7% surge in rental prices within the private rental market across the United Kingdom (UK) over the past 12 months.

The UK economy contracted in March as the services sector recorded a slump amidst wet weather and ongoing public sector strikes and it will only be in the third quarter that economists expect to see a more notable recovery building.

The GfK Consumer Confidence Barometer posted a third consecutive monthly gain in April as it reached its highest level since February 2022.

The Pound to Euro exchange rate could struggle to hold a small weekly advance after UK retail sales figures disappointed.

The British Pound jumped against the Euro, Dollar and the majority of its peer currencies after a flush of stronger-than-expected UK inflaton figures that seal another interest rate hike at the Bank of England in May.

The UK reported another strong set of labour market statistics that will maintain pressure on the Bank of England to raise interest rates again in May, however, signs of a slowdown are becoming increasingly clear say some economists.

Searingly hot wage data will keep pressure on the Bank of England to raise interest rates further, which could in turn ensure the British Pound remains supported.

Economists at UK high street bank Barclays are forecasting inflation figures that will beat market expectations when released on Wednesday, however, Lloyds Bank's economists are looking for a "sharp decline."

The British Pound edged higher against the Euro and Dollar in the wake of UK economic growth data that confirms the UK economy is set to avoid recession in the first half of 2023.