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 over the next 12 months, 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	Q2/18	Q3/18	Q4/18	Q1/19	2020
GDP Growth Rate	0.40	0.3	0.3	0.4	0.5	0.5	percent
Unemployment Rate	4.20	4.3	4.5	4.5	4.4	4.8	percent
Inflation Rate	2.50	2.5	2.4	2.2	2.1	2	percent
Interest Rate	0.50	0.75	0.75	1	1	2	percent
Balance of Trade	-965.00	-3000	-3000	-3500	-3700	-1800	GBP Million
Government Debt to GDP	85.30	86.5	86.5	86.5	85.1	82.1	percent


MARKETS	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Currency	1.40	1.38	1.36	1.33	1.31	1.21
Stock Market	7421.03 points	6826	6656	6490	6327	5718
Government Bond 10Y	1.54 percent	1.53	1.71	1.91	2.14	3.36

GDP	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
GDP Growth Rate	0.40 percent	0.3	0.3	0.4	0.5	0.5
GDP Annual Growth Rate	1.40 percent	1.4	1.4	1.3	1.3	1.5
GDP	2647.90 USD Billion	3050	3050	3050	3180	3290
GDP Constant Prices	492785.00 GBP Million	492044	494312	499191	493758	513773
Gross National Product	508627.00 GBP Million	498093	506822	515239	504272	530289
Gross Fixed Capital Formation	84133.00 GBP Million	83404	83825	85227	82514	87716
GDP per capita	41602.98 USD	42600	42600	42600	43130	43870
GDP per capita PPP	38901.05 USD	40200	40200	40200	40700	41100
GDP From Agriculture	2627.00 GBP Million	2642	2672	2661	2660	2739
GDP From Construction	28021.00 GBP Million	28131	28249	28385	28407	29214
GDP From Manufacturing	44457.00 GBP Million	43733	44202	45035	44017	46350
GDP From Mining	4969.00 GBP Million	5155	5260	5034	5140	5181
GDP From Public Administration	19777.00 GBP Million	19915	19890	20034	19925	20619
GDP From Services	349531.00 GBP Million	349504	350514	354075	350674	364417
GDP From Transport	19246.00 GBP Million	19201	19168	19496	19395	20066

LABOUR	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Unemployment Rate	4.20 percent	4.3	4.5	4.5	4.4	4.8
Employed Persons	32262.00 Thousand	32160	32180	32190	32220	32700
Unemployed Persons	855.30 Thousand	852	849	855	866	885
Part Time Employment	8582.00 Thousand	8700	8730	8760	8800	8960
Full Time Employment	23679.00 Thousand	23640	23660	23670	23740	23990
Employment Rate	75.40 percent	75.6	75.5	75.2	75.2	74.6
Claimant Count Change	11.60 Thousand	11	9	10	5	6
Labor Force Participation Rate	78.80 percent	79.4	79.6	80	79.9	81
Long Term Unemployment Rate	1.10 percent	1.3	1.4	1.5	1.5	2
Youth Unemployment Rate	11.50 percent	11.2	11	11.2	11.3	11.9
Labour Costs	105.50 Index Points	105	106	106	106	110
Productivity	101.90 Index Points	103	104	104	105	108
Job Vacancies	815.00 Thousand	785	786	787	785	792
Wages	513.00 GBP/Week	518	520	522	524	539
Wage Growth	2.80 percent	3.1	3.2	3.3	3.4	3.2
Wages in Manufacturing	596.00 GBP/Week	602	604	606	608	622
Minimum Wages	7.83 GBP/Hour	7.83	7.83	7.83	8	8.5
Population	65.81 Million	66.29	66.29	66.29	66.33	67.16
Retirement Age Women	65.00	65	65	65	65.5	66
Retirement Age Men	65.00	65	65	65	65.5	66
Living Wage Family	1280.00 GBP/Month	1350	1350	1350	1440	1520
Living Wage Individual	970.00 GBP/Month	1170	1170	1250	970	1470
Average Weekly Hours	32.00 Hours	32.2	32.2	32.2	32.2	32.3
Employment Change	55.00 Thousand	91	-64	150	100	110
Wages Low Skilled	1330.00 GBP/Month	1350	1350	1350	1450	1550
Wages High Skilled	2210.00 GBP/Month	2360	2360	2360	2410	2490

PRICES	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Inflation Rate	2.50 percent	2.5	2.4	2.2	2.1	2
Inflation Rate Mom	0.10 percent	0.3	0.4	0.3	0.2	0.5
Consumer Price Index CPI	105.00 Index Points	106	107	107	108	112
Harmonised Consumer Prices	105.00 Index Points	106	107	107	108	112
Core Consumer Prices	105.13 Index Points	106	107	108	108	113
Core Inflation Rate	2.30 percent	2.4	2.3	2.3	2.2	2.2
GDP Deflator	104.55 Index Points	106	106	107	108	114
Producer Prices Change	2.40 percent	2.5	2.2	2.2	2.3	2.5
Export Prices	112.80 Index Points	115	116	116	117	120
Import Prices	111.10 Index Points	112	113	113	114	116
Food Inflation	3.00 percent	2.3	2.2	2.2	2.3	2
Inflation Expectations	2.90 percent	2.6	2.5	2.5	2.4	2.2
Producer Prices	112.60 Index Points	113	114	115	116	120
CPI Housing Utilities	103.16 Index Points	105	105	105	106	110
CPI Transportation	106.77 Index Points	107	108	110	109	115

MONEY	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Interest Rate	0.50 percent	0.75	0.75	1	1	2
Interbank Rate	0.75 percent	0.77	0.77	1.02	1.02	2.02
Money Supply M0	81518.00 GBP Million	95600	97500	99500	102100	122400
Money Supply M1	1715394.00 GBP Million	1889000	1955000	2029400	2071000	2510800
Money Supply M2	2363560.00 GBP Million	2510700	2562000	2632100	2691000	3129100
Money Supply M3	2828684.00 GBP Million	2999800	3063000	3110000	3164000	3420000
Foreign Exchange Reserves	164209.80 USD Million	168000	172000	176000	179000	205000
Banks Balance Sheet	3789669.00 GBP Million	4050000	4110000	4180000	4250000	4510000
Central Bank Balance Sheet	589865.00 GBP Million	611000	622000	629000	641000	700200
Loans to Private Sector	2381400.00 GBP Million	2440000	2470000	2510000	2550000	2810000
Deposit Interest Rate	0.25 percent	0.5	0.5	0.75	0.75	1.75
Lending Rate	0.75 percent	1	1	1.25	1.25	2.25
Private Debt to GDP	217.05 percent	215	215	215	211	208

TRADE	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Balance of Trade	-965.00 GBP Million	-3000	-3000	-3500	-3700	-1800
Exports	52447.00 GBP Million	54200	54800	55100	55400	57700
Imports	53412.00 GBP Million	57200	57800	58600	59100	59500
Current Account	-18443.00 GBP Million	-22700	-19800	-26700	-20400	-22800
Current Account to GDP	-4.10 percent	-3.7	-3.7	-3.3	-2.5	-1.5
External Debt	6385526.00 GBP Million	6383000	6452000	6512000	6583000	6811000
Terms of Trade	101.50 Index Points	103	103	103	103	103
Capital Flows	24382.00 GBP Million	15400	17900	40000	13600	36900
Foreign Direct Investment	8667.00 GBP Million	26300	-700	15200	36200	15900
Gold Reserves	310.30 Tonnes	310	310	310	310	310
Crude Oil Production	739.00 BBL/D/1K	750	750	750	700	550
Terrorism Index	5.10	5.1	5.1	5.1	5.1	5.1
Tourism Revenues	1560.00 GBP Million	2100	2500	2240	1450	2490
Tourist Arrivals	2590.00 Thousand	3460	3340	2810	2300	2990
Weapons Sales	1214.00 USD Million	1336	1265	1194	1222	1278

GOVERNMENT	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Government Debt to GDP	85.30 percent	86.5	86.5	86.5	85.1	82.1
Government Budget	-2.30 percent of GDP	-2.2	-2.2	-2.2	-1.8	-1.6
Government Budget Value	4950.00 GBP Million	21600	15980	9450	17400	9980
Government Spending	91747.00 GBP Million	92043	91976	92940	92294	95654
Government Spending to GDP	41.10 percent	41	41	41	41.5	42
Government Debt	262.00 GBP Million	-3970	-7850	-6130	-2020	-5460
Military Expenditure	54216.80 USD Million	54338	54671	55005	55195	57442
Asylum Applications	2935.00 persons	3040	3070	2710	2980	2210
Government Revenues	61424.00 GBP Million	55960	53400	57890	57450	61870

BUSINESS	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Business Confidence	-4.00 Index Points	6	5	4	5	2
Manufacturing PMI	55.10	56.8	55.4	56	55.7	53.4
Services PMI	51.70 Index Points	53.6	53	53.4	53.8	54.1
Industrial Production	2.20 percent	2.4	2.5	2.3	2.2	2.1
Industrial Production Mom	0.10 percent	-0.2	-0.1	0.3	0.34	0.3
Manufacturing Production	2.50 percent	2.8	3.3	2.5	3	2.3
Capacity Utilization	81.20 percent	82.7	82.7	82.8	82.9	82.7
New Orders	12701.00 GBP Million	15000	15290	15450	15620	16480
Factory Orders	4.00 Net Balance	6	5	3	2	-2
Changes in Inventories	-760.00 GBP Million	-477	-509	-136	126	101
Bankruptcies	4382.00 Companies	3580	3500	3600	4335	4000
Corporate Profits	109353.00 GBP Million	113000	114000	114000	115000	121000
Zew Economic Sentiment Index	-44.70	-12	-6	2	3	12
Car Production	145475.00 Units	159400	162000	125000	164200	132000
Car Registrations	474069.00	261000	471000	190000	571000	196000
Small Business Sentiment	23.00	15	16	14	12	10
Internet Speed	16920.86 KBps	19592	20115	20629	21136	26174
IP Addresses	27493519.00 IP	27724943	27792189	27772468	27811855	27862632
Private Investment	0.30 percent	0.5	0.5	0.7	0.6	0.5
Mining Production	1.30 percent	2.5	2.4	2.5	2.3	2
Steel Production	574.00 Thousand Tonnes	630	620	720	680	850
Competitiveness Index	5.51 Points	5.51	5.51	5.51	5.55	5.61
Competitiveness Rank	8.00	8	8	8	7	6
Composite Pmi	52.50	54	53.8	52.9	53	52.8
Corruption Index	82.00 Points	83	83	83	84	85
Corruption Rank	8.00	8	8	8	7	6
Ease of Doing Business	7.00	6	6	6	7	5
Electricity Production	30349.00 Gigawatt-hour	24900	26000	30000	27100	30200

CONSUMER	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Consumer Confidence	-7.00 Index Points	-12	-12	-10	-10	-6
Retail Sales MoM	-1.20 percent	0.4	0.2	0.7	-0.2	0.5
Retail Sales YoY	1.10 percent	1.9	2.2	2.3	2.4	2.7
Consumer Spending	325299.00 GBP Million	325802	326754	329528	326884	339153
Disposable Personal Income	332967.00 GBP Million	335600	336100	337100	338000	361400
Personal Savings	5.30 percent	4.9	4.8	4.5	4.7	7.9
Bank Lending Rate	1.50 percent	1.75	1.75	2	2	3
Households Debt To Gdp	86.50 percent of GDP	88.5	88.5	88.5	85	82
Households Debt To Income	126.42 percent	130	130	130	127	132
Consumer Credit	1647.00 GBP Million	1650	1770	1680	1720	2130
Gasoline Prices	1.68 USD/Liter	1.59	1.5	1.41	1.33	0.93

HOUSING	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Housing Starts	35590.00	43110	42740	38950	43220	44750
Construction Output	-3.00 percent	0.9	1.2	1.7	2.2	2.2
Housing Index	737.50 Index Points	732	734	736	738	749
Mortgage Approvals	63.91 Thousand	71.4	72.9	73.7	75.1	97.6
Mortgage Applications	38120.00 Units	44600	45800	47600	47900	52600
Home Ownership Rate	63.40 percent	63.1	63.1	63.1	62	61.5
Construction Orders	-1.30 percent	2.9	2.5	1.8	2.4	2.5
Construction Pmi	47.00	52.6	51.5	52.9	53.2	52.9

TAXES	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Corporate Tax Rate	19.00 percent	19	19	19	18	17
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	26	25.8
Social Security Rate For Companies	13.80 percent	13.8	13.8	13.8	13.7	13.8
Social Security Rate For Employees	12.00 percent	12	12	12	11.96	12

CLIMATE	Actual	Q2/18	Q3/18	Q4/18	Q1/19	2020
Temperature	6.92 celsius	9.96	13.43	6.35	4.35	8.7
Precipitation	224.90 mm	73.51	95.45	126	101	101

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