MARCH 2012
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Copyright Consensus Economics Inc. 2012
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
2.2
2.4
2.6
2.8
2011
2012
Jan Feb Mar
Jan Feb Mar
Apr May Jun
Jul Aug Sep
Oct Nov Dec
5.2
5.4
-27.0
-22.0
110
95
1.2
1.5
2.7
3.5
5.1
5.1
-36.0
-47.5
125
132
1.1
2.3
2.5
2.9
4.4
3.8
-8.1
-7.4
101
97
2.2
2.5
na
na
na
na
na
na
na
na
na
na
na
na
na
na
-36.4
-39.9
120
105
1.2
1.2
na
na
na
na
-31.4
-35.3
118
97
1.0
na
2.5
na
5.1
5. 1
-33.0
-27.9
118
94
na
na
na
na
5.8
5.7
-22.0
-8.0
112
105
1.0
1.0
1.8
2.1
na
na
-23.1
-17.5
100
82
1.1
0.8
2.3
2.6
5.4
5.3
-34.0
-28.0
120
107
1.0
0.9
2.3
2.7
na
na
-19.9
-11.2
121
100
na
na
na
na
na
na
na
na
na
na
na
na
na
na
5.2
5.0
-24.0
-19.0
117
na
na
na
na
na
na
na
-24.2
-18.9
na
na
na
na
2.4
2.5
5.0
5.0
-28.4
-23.4
114
96
1.0
0.9
2.3
3.1
5.8
5.8
-12.0
-8.0
126
114
na
na
na
na
5.9
5.8
-20.1
-1.1
109
92
1.0
0.8
2.4
2.5
na
na
na
na
na
na
na
na
na
na
5.2
5.1
na
na
na
na
na
na
na
na
5.4
5.8
-35.0
-15.0
119
98
na
na
na
na
5.2
5.6
-30.0
-22.0
na
na
0.9
1.1
2.1
2.5
6.1
6.7
-2.2
20.2
121
111
0.9
0.8
1.9
1.6
5.3
5.5
-22.3
-24.1
125
105
0.9
0.9
2.5
3.0
5.4
5.3
-38.7
-20.1
138
122
1.0
0.7
2.1
2.2
5.8
6.1
-37.0
-44.0
120
115
1.1
1.1
2.0
2.0
5.4
5.4
-25.9
-20.0
118
104
1.1
1.2
2.3
2.5
5.5
5.5
-26.3
-20.3
120
104
5.3
-19.9
119
6.1
6.7
-2.2
20.2
138
132
2.2
2.5
2.7
3.5
4.4
3.8
-38.7
-47.5
100
82
0.9
0.7
1.8
1.6
0.4
0.6
9.8
15.3
9
12
0.3
0.6
0.3
0.5
-36.0
120
-5
-4
-3
-2
-1
0
1
2
3
4
5
6
1992
1997
2002
2007
2012
2016
Major Export Markets
(% of Total)
United States
11.4
Germany
11.2
Netherlands
8.5
Eastern Europe
5.5
Asia (ex. Japan)
5.0
Middle East
3.5
Fiscal Years
(Apr-Mar)
Real Growth and Inflation
UNITED KINGDOM
Rates on Survey Date
Year
Average
2.1%
Annual Total
1.1%
Direction of Trade 2010
Major Import Suppliers
(% of Total)
Germany
13.1
China
9.1
Netherlands
7.5
Asia (ex. Japan)
13.6
Eastern Europe
6.3
Latin America
2.5
%
Current Account (GBP bn)
Public Sector Net Borrowing (GBP bn)

3 month Interbank Rate (%)

10 Year Gilt Yield (%)

Unemploy-
ment Rate
(% Claimant)
Count)
<Forecast>
%
GDP Growth and Inflation Forecasts
Consensus Forecasts from Survey of:
2012 Consumer Price Inflation Forecasts (%)
2012 Real GDP Growth Forecasts (%)
UK Official Bank Rate - March 12, 2012 = 0.50%
0.53%
0.56%
0.59%
0.66%
0.50%
0.50%
0.50%
0.50%
Consensus
Mean Average:
Mode (most
frequent forecast):
FORECASTS
End Mar.
End Jun.
End Sep.
End Dec.
2012
2012
2012
2012
Real GDP (% chg yoy)
Consumer Prices (% chg yoy)
(% change over previous year)
UK Could Avoid a Double-Dip Recession
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Despite a contraction of 0.2% (q-o-q) in GDP in the final quarter of 2011, household consumption recorded a surprise increase of 0.5% (q-o-q) which has raised hopes that the UK could possibly escape the lingering threat of a double-dip recession. Further positive signs have emanated from the latest purchasing managers surveys. The services PMI slipped below the January level of 56.0 but still recorded 53.8 whilst the manufacturing PMI registered 51.2 in February although orders fell to 49.9. The construction index rose to 54.3 which is its highest level in 11 months and further indicates expansion at the beginning of 2012. Disrupting the optimistic outlook however, retail sales fell 0.3 % (y-o-y) in February, for the second consecutive month, whilst industrial production, which declined by 1.4% (q-o-q) in Q4, stagnated in January at as the warm weather restricted utilities output.
Consumer price inflation fell from a y-o-y rate of 4.2% in December to 3.6% in January which should help to ease some of the pressure on household income. Consumers have been hindered by high inflation and low wage growth. The moderation reflects the disappearance of the January 2011 VAT rise from the data, although falling food and energy prices also contributed to the moderation in the inflation rate. This could encourage the MPC that recent quantitative easing has been an appropriate policy tool, although oil price rises are likely to push up petrol costs and the CPI in the short-term. Further gilt purchases were voted for at the February MPC meeting, and it is expected that there will be at least one further round of quantitative easing in May. Despite this, our panel still expects a much lower level of inflation this year of 2.7%.
End
End
Jun'12 Mar'13
End
End
Jun'12 Mar'13
2012 2013
2012
2013
FY
FY
12-13 13-14