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UK Business and Economy News Opinions Analysis (October-2017)
by 趙永祥 2017-11-10 08:29:32, Reply(0), Views(155)


UK Business and Economy News Opinions Analysis

(Announced : 15-October-2017)


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UK Business and Economy News Opinions Analysis

3rd November 2017 – More Signs That Most UK Economists Are Wrong About British Economy Again

Britain’s services sector grew by the fastest rate in six months.

IHS Markit/CIPS purchasing managers’ index (PMI) jumped to 55.6 in October from 53.6 in September, its highest level since April and its biggest one-month rise since August 2016.

2nd November 2017 – UK Interest Rates Rise For First Time In 10 Years

The Bank of England BoE increased UK bank base by 0.25% to 0.50%.   The Governor of the BoE says that this is a good news story for the UK.   It indicates that the economy is growing.   Businesses are investing more.

Consumer debt is not out of control, but inflation needs controlling with a rate rise now and more rate rises in near future.

Borrowing is set to increase.   Hopefully UK savers will benefit from higher rates.

1st November 2017 – UK Manufacturing Sector Outperforms The Economic Experts Once Again

The UK pound has jumped to a new intraday high against the USdollar after it was revealed that the UK manufacturing sector is buzzing.

UK manufacturing posted stronger than expected sector performance in October, according to latest IHS Markit’s PMI survey.

Britain’s manufacturers are increasingly confident that the global economy, including the often derided UK economy, is recovering.   Recruitment in UK manufacturing factories is up and set to increase at its fastest rate in years so UK manufacturing output is going to increase too.

UK growth accelerated in the manufacturing sector in October, with new orders increased and UK exports grew.   The UK manufacturing sector may even hit annualised growth of 4% if the present rate of expansion continues over the next 12 months.   The number of UK manufacturers expecting new orders to fall is in single digits.

Will UK interest rates will rise this week?   Yes.

9th October 2017 – UK Wage Costs Rising Faster Than Thought

The Office for National Statistics ONS miscalculated a measure which suggest UK wages are rising faster than first indicated.   This means that it is more likely that UK interest rates will rise in November 2017.

The ONS issued a correction after it messed up the calculation of a crucial measure the Bank Of England BoE uses to decide on interest rate adjustments in UK.   The ONS used the wrong set of data to calculate UK labour cost, the cost of employment per worker.

UK labour cost rose 2.4% in second quarter of 2017 not the 1.6% the ONS previously said it rose.   Now that the BoE knows UK labour unit costs are rising faster than thought there is more pressure to raise interest rate in UK to mitigate the threat to rising inflation.

On the plus side this shows that wages are rising faster which is a sign that the UK economy will strengthen further.

29th September 2017 – Mark Carney, governor of Bank of England BoE, indicates a UK interest rate rise in November 2017

Mark Carney said on BBC’s Today programme today that UK interest rates “on track” to rise in November 2017.

“What we have said, that if the economy continues on the track that it’s been on, and all indications are that it is, in the relatively near term we can expect that interest rates would increase”

Most financial economists and commentators are now factoring in a UK interest rate rise in November.

21st September 2017 – Public Sector Spending Deficit Lowest August Deficit In 10 Years

Domestic and foreign shoppers increased UK government VAT receipts, reducing the amount needed to be borrowed in August.   As a result, the Chancellor might be able to give some money away in the upcoming budget in November including increasing public sector pay faster.

If people have more money to spend, this could boost future government receipts and boost corporate earnings.

20th September 2017 – Majority Of Economists Expect UK Interest Rate Rise In November 2017

The majority of economists polled by Reuters expect the Bank of England BoE to increase UK interest rates in November.

According to the economists polled an interest rate hike in November is now a certainty, yet fairly recently very few were predicting an interest rate rise in 2017.

18th September 2017 – UK Is Growing Faster Than First Thought

The Centre for Economics and Business Research (CEBR) is predicting the economy to grow by 1.5% in 2017, where it previously forecast just 1.3% UK growth.

The CEBR has revised UK growth upwards due to the improved performance of UK manufacturing and increased consumer confidence in UK economy.

16th September – Higher Inflation and Pick Up In UK Growth and Global Growth Could Mean Interest Rate Rise Sooner Than Later

Bank of England representatives on MPC have recently hinted that the UK needs higher interest rates, potentially before the end of 2017.   As a result the value of the pound has risen in the expectation that rates will soon be on the up and not 2019 as previously many economists thought.

Fears that Brexit vote will cause a collapse of the UK economy have failed to materialise.   In fact house prices continue to rise in most parts of the UK, unemployment is a record low’s, wages are starting to rise faster, manufacturing in UK has experienced a renaissance and things are generally very healthy as indicated by rising inflation.

31st August 2017 – UK Should Increase Interest Rates

According to a member of the Monetary Policy Committee MPC, Michael Saunders, the UK needs to increase its interest rate now to help keep inflation under control in the next few months.

In addition, it will start to educate and familiarise people with more noraml interest rate levels and start to adjust their attitude to borrowing and expenditure.   This may help head off a debt bubble bursting in the UK.

27th August 2017 – UK Consumers Are More Confident In UK Economy

British consumer morale improved in August according to poll from YouGov.

Strong trade, particularly UK exports, and business investment should counterbalance any reduction in UK consumer spending, according to the Bank of England, but any uptick in UK consumer confidence will be a welcome bonus to the UK economy.

6th August 2017 – Credit Boom Threatening UK Resilience

The majority of actual real economic figures suggest that interest rates should have risen by now, however the Bank of England BoE continues to resist interest rate increases in the UK.

UK consumers are borrowing more.   Much of this extra borrowing is being spent on consumer goods like new cars.   The UK consumer is very used to cheap money and there is a belief that interest rates will never increase.   This belief is being fed by the BoE who don’t raise interest rates.

In addition, there is no reason to save money in the UK.   Interest rates are so low the return doesn’t even cover inflation.   If interest rates were increased inflation would reduce and savers would have more of an incentive to save for the future.

5th August 2017 – UK Economy To Boom In Second Half Of 2017

Britain’s economy is about to prove to people it is far healthy than the figures for the first half of 2017.

The National Institute Of Economic and Social Research (NIESR) is a think tank that believes that the UK economy is about to perform very strongly.   Overall growth for 2017 will be 1.7% but this is only because of the relatively slow growth of the first half of 2017.   UK economic growth will be driven by UK exporters, who will continue to outperform even recent good business development.

4th August 2017 – Former Bank Of England Deputy Governor Says The UK Should Be Raising Interest Rate Now

Sir John Gieve says there is a “strong case” for raising UK interest rates because the economic disaster predicted by Remainers if the UK voted to leave the European Union EU has not happened.

The Bank of England this week held UK interest rate at 0.25%.   Sir John Gieve looks at low unemployment will start to push up UK wages and inflation is already high compared to recent years and way above the Bank of England’s own target of 2%.   If now is not the right time to raise UK interest rate then when is?

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