UK Economy – What’s Been Happening

Kath went to the Manchester Monetary Policy Report Briefing last week and has pulled together a quick summary of how the UK economy has been performing.

  • UK GDP growth slowed last year, with inflation rates being below the 2% target
  • This was caused by investment being weak due to uncertainty of Brexit and lower global growth
  • There are early signs growth has stabilised and is picking up again
  • Demand for goods reduced, but this is beginning to soften post-election – still negative but starting to show signs of improvement
  • Inflation fell due to the reduction of utility bills and slow growth
  • The value of sterling has improved which has put downward pressure on inflation
  • Predict modest productivity growth over the next 3 years
  • Currently Manufacturing and Finance sectors dragging down productivity growth because of Brexit contingency planning
  • Consumer confidence is beginning to increase but not considerately
  • The labour market has tightened
  • Firms are labour hoarding and not utilising capital
  • Unemployment rate low and stable
  • Little spare capacity for unemployment

You can read the full report here.