United Kingdom - Economic Forecasts - 2018-2020 Outlook

UK GDP growth is expected to slow further in 2018 as public spending cuts and Brexit-related uncertainty weigh on the economy. Still, the unemployment rate is expected to remain close to its equilibrium rate of around 4.5 percent in the near term although wage growth is likely to remain low, resulting in falling real wages. Inflation is forecast to fall towards the Bank of England's 2 percent target until the end of the year, easing the squeeze on households' finances, and house price inflation is seen to average just over 3 percent. In addition, business investment and exports are likely to be supported by the pickup in global growth. Interest rates are set to rise slowly. This page has economic forecasts for the United Kingdom including a long-term outlook for the next decades, plus medium-term expectations for the next four quarters and short-term market predictions for the next release affecting the the United Kingdom economy.


Overview Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
GDP Growth Rate 0.40 0.2 0.1 0.4 0.5 0.5 percent
Unemployment Rate 4.00 4.2 4.4 4.5 4.5 5.1 percent
Inflation Rate 2.70 2.2 2.1 2.2 2.1 2 percent
Interest Rate 0.75 1 1 1.25 1.25 2 percent
Balance of Trade -1274.00 -1400 -1700 -1900 -2300 -1800 GBP Million
Government Debt to GDP 85.30 86.5 85.1 85.1 85.1 82.1 percent
MARKETS Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Currency 1.32
1.29 1.28 1.27 1.27 1.24
Stock Market 7059.40
points
7435 7368 7300 7234 6975
Government Bond 10Y 1.61
percent
1.63 1.68 1.74 1.8 2.04
GDP Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
GDP Growth Rate 0.40
percent
0.2 0.1 0.4 0.5 0.5
GDP Annual Growth Rate 1.20
percent
1.3 1.3 1.4 1.5 1.5
GDP 2622.43
USD Billion
2850 3060 3060 3060 3170
GDP Constant Prices 506029.00
GBP Million
509553 510750 513113 508750 524437
Gross National Product 515919.00
GBP Million
512459 518415 523142 511104 527428
Gross Fixed Capital Formation 86324.00
GBP Million
87906 86722 87533 87358 90474
GDP per capita 42514.49
USD
42800 43200 43200 43200 43800
GDP per capita PPP 39753.24
USD
40200 40700 40700 40700 41100
GDP From Agriculture 2909.00
GBP Million
2993 2948 2950 3007 3081
GDP From Construction 28198.00
GBP Million
28551 28311 28593 28508 29385
GDP From Manufacturing 45358.00
GBP Million
46409 46381 45993 45865 47764
GDP From Mining 4607.00
GBP Million
4525 4637 4671 4762 4657
GDP From Public Administration 20674.00
GBP Million
20984 20979 20963 20965 21597
GDP From Services 360420.00
GBP Million
362131 363182 365466 361559 372709
GDP From Transport 19323.00
GBP Million
19607 19351 19594 19493 20179
LABOUR Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Unemployment Rate 4.00
percent
4.2 4.4 4.5 4.5 5.1
Employed Persons 32394.00
Thousand
32510 32580 32620 32710 33700
Unemployed Persons 942.90
Thousand
942 951 955 964 1015
Part Time Employment 8538.00
Thousand
8460 8420 8400 8420 8190
Full Time Employment 23859.00
Thousand
24050 24160 24220 24290 25510
Employment Rate 75.50
percent
75.2 75.2 75.1 75 74.6
Claimant Count Change 18.50
Thousand
10 5 7 11 6
Labor Force Participation Rate 78.80
percent
80 79.9 79.9 80.2 81
Long Term Unemployment Rate 1.10
percent
1.2 1.3 1.4 1.4 1.7
Youth Unemployment Rate 11.00
percent
11.2 11.3 11.5 11.5 11.9
Labour Costs 103.90
Index Points
106 106 107 108 110
Productivity 101.60
Index Points
103 103 104 105 108
Job Vacancies 833.00
Thousand
815 820 819 814 792
Wages 520.00
GBP/Week
522 524 526 529 539
Wage Growth 2.70
percent
3 3.2 3.4 3.2 2.8
Wages in Manufacturing 603.00
GBP/Week
603 605 607 609 619
Minimum Wages 7.83
GBP/Hour
7.83 8 8 8 8.5
Population 66.19
Million
66.19 66.36 66.36 66.36 66.98
Retirement Age Women 65.00
65 65.5 65.5 65.5 66
Retirement Age Men 65.00
65 65.5 65.5 65.5 66
Living Wage Family 1280.00
GBP/Month
1350 1440 1440 1440 1520
Living Wage Individual 970.00
GBP/Month
1170 1290 1290 1290 1370
Average Weekly Hours 31.90
Hours
32.2 32.2 32.3 32.3 32.3
Employment Change -5.00
Thousand
150 100 85 -82 110
Wages Low Skilled 1330.00
GBP/Month
1350 1450 1450 1450 1550
Wages High Skilled 2210.00
GBP/Month
2360 2410 2410 2410 2490
PRICES Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Inflation Rate 2.70
percent
2.2 2.1 2.2 2.1 2
Inflation Rate Mom 0.70
percent
0.3 0.2 0.3 0.3 0.5
Consumer Price Index CPI 106.50
Index Points
119 107 108 109 134
Harmonised Consumer Prices 106.50
Index Points
107 108 108 109 112
Core Consumer Prices 106.50
Index Points
118 107 108 109 133
Core Inflation Rate 2.10
percent
2.3 2.2 2.2 2.2 2.2
GDP Deflator 103.50
Index Points
105 106 107 108 112
Producer Prices Change 2.90
percent
2.2 2.3 2.4 2.3 2.5
Export Prices 113.40
Index Points
114 115 115 116 119
Import Prices 111.40
Index Points
112 113 113 114 116
Food Inflation 2.50
percent
2.5 2.4 2.2 2.1 2
Inflation Expectations 3.00
percent
2.6 2.4 2.3 2.3 2.2
Producer Prices 114.20
Index Points
122 115 117 117 134
CPI Housing Utilities 104.70
Index Points
105 106 106 107 110
CPI Transportation 113.30
Index Points
109 110 113 110 114
Core Producer Prices 112.50
Index Points
113 114 115 115 119
MONEY Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Interest Rate 0.75
percent
1 1 1.25 1.25 2
Interbank Rate 0.81
percent
0.8 0.8 1.05 1.05 1.8
Money Supply M0 82043.00
GBP Million
89500 98100 104200 106900 122400
Money Supply M1 1746719.00
GBP Million
1979400 2041000 2111000 2181000 2510800
Money Supply M2 2377022.00
GBP Million
2602100 2651000 2746000 2856000 3129100
Money Supply M3 2833088.00
GBP Million
3020000 3124000 3184000 3224000 3420000
Foreign Exchange Reserves 161256.43
USD Million
172000 175000 179000 185000 205000
Banks Balance Sheet 3746875.00
GBP Million
4180000 4250000 4280000 4320000 4510000
Central Bank Balance Sheet 592950.00
GBP Million
615000 625000 636000 645000 689200
Loans to Private Sector 2430626.00
GBP Million
2510000 2550000 2580000 2630000 2810000
Deposit Interest Rate 0.50
percent
0.5 0.5 0.75 0.75 1.5
Lending Rate 1.00
percent
1 1 1.25 1.25 2
Private Debt to GDP 229.40
percent
227 225 225 225 221
TRADE Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Balance of Trade -1274.00
GBP Million
-1400 -1700 -1900 -2300 -1800
Exports 55075.00
GBP Million
55100 55400 55900 56200 57700
Imports 56349.00
GBP Million
56500 57100 57800 58500 59500
Current Account -20317.00
GBP Million
-26700 -20400 -20470 -17700 -22800
Current Account to GDP -4.10
percent
-3.7 -3 -3 -3 -2.8
External Debt 6382913.00
GBP Million
6512000 6583000 6655000 6669000 6811000
Terms of Trade 101.80
Index Points
98.4 102 102 102 100
Capital Flows 13843.00
GBP Million
40000 13600 16500 16500 36900
Foreign Direct Investment 22199.00
GBP Million
15200 36200 22500 -9700 15900
Gold Reserves 310.30
Tonnes
310 310 310 310 310
Crude Oil Production 910.00
BBL/D/1K
950 800 800 800 750
Terrorism Index 5.10
5.1 5.1 5.1 5.1 5.1
Tourism Revenues 2008.00
GBP Million
1900 1870 2600 2700 2490
Tourist Arrivals 3234.00
Thousand
2810 3220 4010 3490 3040
Weapons Sales 1214.00
USD Million
1188 1202 1215 1228 1213
GOVERNMENT Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Government Debt to GDP 85.30
percent
86.5 85.1 85.1 85.1 82.1
Government Budget -2.30
percent of GDP
-2.2 -1.8 -1.8 -1.8 -1.6
Government Budget Value -3242.00
GBP Million
1500 5100 -4400 -2200 2100
Government Spending 92940.00
GBP Million
93403 93758 94241 93201 96131
Government Spending to GDP 41.10
percent
41 41.5 41.5 41.5 42
Government Debt -5889.00
GBP Million
-1420 -1240 -3210 -3200 -2460
Military Expenditure 48383.40
USD Million
48729 48888 49046 49205 49776
Asylum Applications 2925.00
persons
2710 2980 2850 2900 2210
Government Revenues 55604.00
GBP Million
57890 64450 57420 58900 61870
BUSINESS Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Business Confidence -3.00
Index Points
-8 -12 1 5 2
Manufacturing PMI 53.80
55.1 52.3 54.4 54.2 51
Services PMI 53.90
Index Points
53.4 52 54 54.5 54.1
Industrial Production 1.30
percent
2.5 2.2 2.3 2.2 2.2
Industrial Production Mom 0.20
percent
0.3 0.3 -0.3 0.6 0.5
Manufacturing Production 1.30
percent
2.5 3 2.6 2.5 2.3
Capacity Utilization 82.30
percent
83.2 83.2 83 82.9 82.7
New Orders 10801.00
GBP Million
15450 15620 15780 15820 16480
Factory Orders -1.00
Net Balance
3 2 2 1 -2
Changes in Inventories 2214.00
GBP Million
373 383 484 391 258
Bankruptcies 3918.00
Companies
4400 4500 4900 4800 4600
Corporate Profits 111344.00
GBP Million
114000 115000 116000 116000 121000
Zew Economic Sentiment Index -61.00
-67 -76 -48 -20 12
Car Production 89254.00
Units
115000 164200 162500 165000 137000
Car Registrations 338834.00
175000 571000 267000 485000 196000
Small Business Sentiment 6.00
1 -2 5 10 10
Internet Speed 16920.86
KBps
20629 21136 21634 22124 26174
IP Addresses 27493519.00
IP
27772468 27811855 27813411 27838343 27862632
Leading Economic Index 0.70
percent
0.2 0.1 0.4 0.5 0.5
Mining Production 3.50
percent
2.5 2.3 2.2 2.4 2
Private Investment -0.70
percent
-0.6 -1 0.6 0.5 0.5
Steel Production 550.00
Thousand Tonnes
720 680 640 640 850
Competitiveness Index 5.51
Points
5.51 5.51 5.51 5.51 5.51
Competitiveness Rank 8.00
8 8 8 8 8
Composite Pmi 54.10
52.9 51.5 53.4 54.1 52.8
Corruption Index 82.00
Points
82 82 82 82 82
Corruption Rank 8.00
8 8 8 8 8
Ease of Doing Business 7.00
6 5 5 5 5
Electricity Production 24914.00
Gigawatt-hour
30000 27100 25100 26000 30200
CONSUMER Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Consumer Confidence -9.00
Index Points
-10 -14 -8 -7 -6
Retail Sales MoM 0.30
percent
0.7 -0.2 0.4 0.2 0.5
Retail Sales YoY 3.30
percent
2.3 2.4 2.6 2.5 2.7
Consumer Spending 332149.00
GBP Million
334590 335344 336799 334347 344363
Disposable Personal Income 335929.00
GBP Million
337100 338000 340500 342200 361400
Personal Savings 4.40
percent
4.5 4.7 4.9 5.1 7.9
Bank Lending Rate 1.75
percent
2 2 2.25 2.25 3
Households Debt To Gdp 86.10
percent of GDP
88.5 87 87 87 85
Households Debt To Income 126.42
percent
130 132 132 132 132
Consumer Credit 1118.00
GBP Million
1680 1720 1790 1850 2130
Gasoline Prices 1.72
USD/Liter
1.56 1.52 1.41 1.31 1.48
HOUSING Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Housing Starts 41190.00
units
38950 43220 43400 45100 44750
Construction Output 0.30
percent
1.7 2.2 2.5 2.4 2.2
Housing Index 731.40
Index Points
755 762 769 775 795
Mortgage Approvals 66.44
Thousand
66.2 70.1 75.5 79.6 97.6
Home Ownership Rate 63.40
percent
63.1 62.5 62.5 62.5 62
Mortgage Applications 39402.00
Units
47600 47900 48400 48900 52600
Construction Orders -7.40
percent
1.5 2.5 4.5 3.6 2.5
Construction Pmi 52.10
53.8 50.8 53.6 53.2 52.9
TAXES Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Corporate Tax Rate 19.00
percent
19 19 19 19 19
Personal Income Tax Rate 45.00
percent
45 45 45 45 45
Sales Tax Rate 20.00
percent
20 20 20 20 20
Social Security Rate 25.80
percent
25.8 25.8 25.8 25.8 25.8
Social Security Rate For Companies 13.80
percent
13.8 13.8 13.8 13.8 13.8
Social Security Rate For Employees 12.00
percent
12 12 12 12 12
CLIMATE Actual Q4/18 Q1/19 Q2/19 Q3/19 2020
Temperature 6.92
celsius
6.35 4.35 10.44 9.56 8.7
Precipitation 224.90
mm
126 101 104 104 101