Latest: Economy News

Inflation falls to 2.5 per cent

Inflation falls to 2.5 per cent

Inflation fell to 2.5 per cent in August, from 2.6 per cent in the previous month, as measured by the Consumer Prices Index (CPI). The latest official figures from the Office of National Statistics also show that inflation also fell on the Retail Prices Index (RPI) measure, from 3.2 per cent in July to 2.9 […]

September 18, 2012 More
OECD sees signs of growth for UK economy

OECD sees signs of growth for UK economy

The Organisation for Economic Cooperation and Development (OECD) has reported ‘tentative signs’ that the UK economy will start to recover within the next six-to-nine months. Its forecast follows a further fall in unemployment in the UK, helped by the London Olympics. The number of people out of work fell by 7,000 to 2.59 million in […]

September 14, 2012 More
Food price inflation flat but price rises expected

Food price inflation flat but price rises expected

Annual food price inflation remained at 3.1 per cent in August, the same as the previous month’s two-year low, according to data released by the British Retail Consortium (BRC). However, although food price inflation seems to be bottoming out, the cost of food is increasing at a faster rate than incomes, which have grown by […]

September 5, 2012 More
Raising a child costs £8,000 a year

Raising a child costs £8,000 a year

The average cost of raising a child up to the age of 11 increased to £8,307 a year in 2011, according to the Halifax. The figure represents a 15 per cent increase over the last five years and means that it now costs more than £90,000 to raise a child to secondary school age. Inflation, […]

September 3, 2012 More
Rich have benefited most from quantitative easing

Rich have benefited most from quantitative easing

The Bank of England has admitted in a new report that the richest 5 per cent of UK households have benefitted the most from its quantitative easing (QE) programme. The Bank launched the programme in March 2009, in an effort to revive economic growth. In total it has bought £375bn of government bonds, known as […]

August 24, 2012 More
Households more optimistic about their finances

Households more optimistic about their finances

Household finances are still deteriorating, but at a slower rate, according to the Markit household finance index. The index increased from 37.5 in July to 38.9 in August, with figures above 50 representing a positive change in household finances, and figures below 50 representing a negative change. The August figure represents the third consecutive monthly […]

August 20, 2012 More
Bank of England forecasts zero economic growth

Bank of England forecasts zero economic growth

The Bank of England does not expect the UK economy to grow at all this year according to its latest quarterly report. It had previously forecast growth of 2 per cent for 2012 but recent gloomy economic data has led to the growth forecast being revised downwards. The forecast for medium-term growth has also been […]

August 8, 2012 More
Economy benefiting from PPI refunds

Economy benefiting from PPI refunds

The UK economy is receiving a welcome boost from compensation paid by banks to customers who were mis-sold payment protection insurance (PPI). British banks have already paid out £9 billion after it came to light that they had been routinely mis-selling insurance policies designed to protect repayments on mortgage, loan and credit cards. With payouts […]

August 7, 2012 More
Households’ disposable income falls

Households’ disposable income falls

In the 2012 first quarter, individuals’ disposable income fell to the lowest level since 2003, according to new figures from the Office for National Statistics. Spending power is being eroded because wages are failing to keep up with inflation causing the average disposable income in the first quarter to fall to £273. Disposable income including […]

July 31, 2012 More
Double-dip recession worst for 50 years

Double-dip recession worst for 50 years

The latest official figures reveal that the UK economy contracted by 0.7 per cent in the second quarter of 2012, significantly more than the 0.2 per cent fall in GDP expected by economists. It is the largest fall in quarterly UK economic outlook since the first three months of 2009 and means that the double-dip […]

July 25, 2012 More
Falling inflation boosts households’ financial confidence

Falling inflation boosts households’ financial confidence

UK Households are feeling less pessimistic about their finances following a fall in inflation last month, according to the latest Markit Household Finance Index. The index, which is designed to give the earliest indication of actual changes in household finances each month, has increased from 37.0 to 37.5. Although this is still significantly below 50.0, […]

July 23, 2012 More
Outlook improves for UK economy

Outlook improves for UK economy

The UK economy could recover more quickly than expected according to economic forecasting group the Ernst & Young Item Club. The Item Club expects the UK to return to growth in the second half of this year, marking an end to the double-dip recession. However this depends on a solution being found to the debt […]

July 17, 2012 More
Double-dip recession deepens

Double-dip recession deepens

The UK economy has contracted for three consecutive quarters according to new figures from the National Institute of Economic and Social Research (NIESR). NIESR estimates that GDP fell by 0.2 per cent in the 2012 second quarter, with the extra bank holiday for the Diamond Jubilee contributing to the fall. This follows a 0.3 per […]

July 11, 2012 More
Bank expands quantitative easing to £375 billion

Bank expands quantitative easing to £375 billion

The Bank of England (BoE) is injecting another £50 billion into the economy, increasing its quantitative easing programme to £375 billion in total. The BoE decided to increase the bond buying programme due to slowing growth in export markets and the ongoing recession. The Bank has also decided that interest rate will remain at the […]

July 5, 2012 More
Economic recovery could take until 2017

Economic recovery could take until 2017

Sir Mervyn King, the governor of the Bank of England, does not expect the UK economy to recover until 2017, three years later than his earlier estimate. The Governor made his gloomy prediction to MPs at a meeting of the Treasury Select Committee (TSC). “When this crisis began in 2007, most people did not believe […]

June 27, 2012 More
Inflation falls to 2.8%

Inflation falls to 2.8%

Inflation fell to 2.8 per cent on the Consumer Prices Index in May, from 3 per cent in April, surprising economists who had not expected it to change. Inflation also fell on the Retail Prices Index, which includes housing costs, from 3.5 per cent in April to 3.1 per cent in June. Inflation is now […]

June 19, 2012 More
Household incomes fall but fewer children in poverty

Household incomes fall but fewer children in poverty

There was a fall in the average household income in 2010—11, due to rising inflation and recession, according to the government’s annual Household Below Average Income (HBAI) report. The number of children living in poverty in the UK also fell because this figure is based on median incomes, and incomes fell proportionally more for wealthier […]

June 14, 2012 More
UK economic growth forecast cut to 0.1%

UK economic growth forecast cut to 0.1%

The British Chamber of Commerce (BCC) has reduced its estimate for growth in the UK’s economy. in its quarterly economic forecast. The BBC has reduced its forecast, from growth of 0.6 per cent in 2012 to just 0.1 per cent. The UK economy contracted by 0.3 per cent in the first quarter and the BCC […]

June 1, 2012 More
Workers will start to feel better off this year

Workers will start to feel better off this year

British workers will start to benefit from lower inflation and taxes this year, ending the year £482 better off than they were in 2011, according to a new report. The Ernst & Young ITEM Club suggests that inflation could fall to two per cent by the end of the year, as long as oil prices […]

May 29, 2012 More
Bank of England votes against more economic stimulus

Bank of England votes against more economic stimulus

The Bank of England voted against a further round of quantitative easing, at its latest Monetary Policy Committee (MPC) meeting. Just one member, David Miles, voted for further asset purchase to encourage growth in the UK economy, while the other eight members voted to keep the Bank’s quantitative easing programme steady at £325bn. The minutes […]

May 24, 2012 More