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.