Latest: Economy News

Monthly incomes £22 lower in 2012

Monthly incomes £22 lower in 2012

The average monthly income of UK households fell by £22 in real terms compared with last year, according to a survey carried out for the Bank of England (BoE) by NMG Consulting. People on lower incomes have seen their income eroded more than higher earners and households still have high levels of debt the BoE […]

December 18, 2012 More
Chancellor open-minded about ending inflation target

Chancellor open-minded about ending inflation target

Chancellor George Osborne has welcomed remarks made by the incoming Governor of the Bank of England about scrapping the inflation target to focus on gross domestic product (GDP). Such a change in strategy would require the Bank of England to introduce new measure to stimulate the economy, even if this caused inflation to rise. Mark […]

December 13, 2012 More
Austerity measures extended in Autumn Statement

Austerity measures extended in Autumn Statement

Chancellor George Osborne is extending the government’s austerity measures until 2018, a year longer than expected, after the Office for Budget Responsibility revised down its forecast for economic growth. Last year, the OBR was optimistic that the economy would grow by 0.8 per cent this year, but it now expects it to contract by 0.1 […]

December 5, 2012 More
Global slowdown holding back UK growth

Global slowdown holding back UK growth

Economic growth is still too weak, the British Chambers of Commerce (BCC) says, although growth exceeded expectations in the last quarter, helped by the Olympics. The BCC expects the UK economy to contract by 0.1 per cent this year, an improvement on the 0.4 per cent contraction previously forecast. However, the organisation has reduced its […]

December 4, 2012 More
Austerity measures could continue until 2018

Austerity measures could continue until 2018

Prior to the Chancellor’s Autumn Statement on 5 December, the Institute for Fiscal Studies (IFS) has warned that the squeeze on public spending may have to continue to 2017/18. Slower than expected economic recovery may mean that the Chancellor, George Osborne, will need to raise another £11 billion from further cuts or by increasing taxes. […]

November 26, 2012 More
Real value of pay falls in UK

Real value of pay falls in UK

The average annual earnings of full-time UK workers increased by 1.4 per cent to £26,500 in the year to April 2012, according to the latest figures from the Office for National Statistics (ONS). However, with inflation at 3.5 per cent during this period, the figures represent a fall in the value of pay in real […]

November 22, 2012 More
Strain on household finances continues to ease

Strain on household finances continues to ease

Financial information services company Markit has reported a further improvement in household finances. Although household finances are continuing to deteriorate, the rate of deterioration fell in November, to its slowest rate for two years. The Markit Household Finance Index increased from 39.0 to 39.3, its fifth increase in six months, but this is still well […]

November 19, 2012 More
Two-child families need £25,000 a year to survive

Two-child families need £25,000 a year to survive

Families with two children need to bring home £24,800 a year just to break even, according to financial advisory firm Skipton Financial Services. This means that they need to be earning more than £30,000 a year gross in order to survive. The cost of living has increased by £130 compared with last year Skipton revealed, […]

November 15, 2012 More
Bank of England reduces UK growth forecast to 1%

Bank of England reduces UK growth forecast to 1%

The Bank of England has reduced its growth forecast to 1 per cent and does not expect inflation to fall to its 2 per cent target until the middle of next year. Presenting the Bank’s quarterly Inflation Report, the governor of the Bank of England, Sir Mervyn King, said that economic recovery would be “slow […]

November 14, 2012 More
Inflation increases to 2.7%

Inflation increases to 2.7%

A combination of higher tuition fees and food prices pushed the inflation rate up to 2.7 per cent last month, according to the latest figures from the Office for National Statistics (ONS). Inflation on the Consumer Prices Index (CPI) increased to 2.7 per cent from 2.2 per cent in September, while the Retail Prices Index […]

November 13, 2012 More
Service sector growth slows

Service sector growth slows

Optimism over the economy has been hit by significantly slower growth in the UK’s largest sector in October. At 50.6 on the Markit/CIPS Purchasing Managers’ Index (PMI) growth in the dominant service sector fell to its weakest level for nearly two year. Analysts had expected it to fall to 52.0 from 52.2 in September, with […]

November 5, 2012 More
Consumer confidence hits six-month low

Consumer confidence hits six-month low

Although the UK has officially emerged from recession, consumer confidence fell to -30 in October from -28 in September, according to market researcher company GfK NOP. This is the lowest level of consumer confidence since April when the UK was in an economic slump. Analysts had expected the index to remain stable at -28. Respondents […]

October 31, 2012 More
UK economy leads Europe

UK economy leads Europe

The UK economy emerged from recession yesterday and now leads the way in Europe according to research group Capital Economics. Gross Domestic Product (GDP) grew by one per cent in the third quarter from July to September, the biggest rise for five years, the latest official figures from the Office for National Statistics (ONS) show. […]

October 26, 2012 More
Improvement seen in consumer finances

Improvement seen in consumer finances

Two separate surveys have reported an improvement in household finances, bolstering optimism that the recession is coming to an end. Although Markit, the financial information services company, reported a worsening in consumer finances in October, it was the smallest deterioration in the past two years. The Markit Household Finance Index, which is designed to accurately […]

October 22, 2012 More
Inflation falls to 2.2%

Inflation falls to 2.2%

The rate of inflation on the Consumer Prices Index (CPI) fell to 2.2 per cent last month according to the Office for National Statistics (ONS), its lowest level since November 2009. In August, CPI inflation, which excludes mortgage interest payments, stood at 2.5 per cent. The Retail Prices Index (RPI) measure of inflation, which includes […]

October 16, 2012 More
Consumer spending power weakens

Consumer spending power weakens

Annual income growth fell to 1.7 per cent last month, its lowest level since December 2010, according to Lloyds Banking Group’s Spending Power Report for September. This was largely responsible for a 0.9 per cent fall in real discretionary spending power, with the amount consumers have to spend on non-essential items falling around £8 per […]

October 15, 2012 More
UK out of recession economic research institute claims

UK out of recession economic research institute claims

The UK economy returned to growth in the third quarter according to the National Institute of Economic and Social Research (NIESR), marking an end to the double dip recession. The NIESR estimates that GDP grew by 0.8 per cent in the three months ending in September, building on an improvement seen in the three months […]

October 10, 2012 More
UK consumer spending higher in September

UK consumer spending higher in September

Consumer spending increased by 3 per cent in September compared with August, as people spent more on clothes and in hotels and restaurants. The figures, from Visa Europe’s UK expenditure index which is compiled by Markit, represent the biggest increase since May 2009. The increased spending follows improvements in the job market which have boosted […]

October 5, 2012 More
British Chambers of Commerce forecasts end to recession

British Chambers of Commerce forecasts end to recession

According to the British Chambers of Commerce’s quarterly economic survey gross domestic product will grow by 0.5 per cent in the third quarter, marking an end to the recession. The BCC is optimistic for growth in the third quarter despite the UK’s continuing weak economic performance. It says that data released by the Office for […]

October 2, 2012 More
Bank of England optimistic for economic growth

Bank of England optimistic for economic growth

Sir Mervyn King, the governor of the Bank of England, expects the UK economy to return to growth in the next quarter, marking an end to the double-dip recession. Speaking on Channel 4 News, Sir Mervyn warned that recovery would be slow and said that the continuing crisis in the eurozone creates uncertainty for British […]

September 21, 2012 More