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 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 Q1/18 Q2/18 Q3/18 Q4/18 2020
GDP Growth Rate 0.40 0.3 0.3 0.4 0.4 0.5 percent
Unemployment Rate 4.40 4.4 4.4 4.3 4.3 4.7 percent
Inflation Rate 3.00 2.8 2.7 2.5 2.4 2 percent
Interest Rate 0.50 0.5 0.75 0.75 1 2 percent
Balance of Trade -4896.00 -2500 -2000 -1900 -1900 -400 GBP Million
Government Debt to GDP 89.30 86.5 86.5 86.5 86.5 81.9 percent
MARKETS Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Currency 1.40
1.35 1.32 1.3 1.27 1.17
Stock Market 7224.98
points
7578 7417 7258 7102 5974
Government Bond 10Y 1.54
percent
1.79 2.01 2.26 2.55 4.07
GDP Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
GDP Growth Rate 0.40
percent
0.3 0.3 0.4 0.4 0.5
GDP Annual Growth Rate 1.40
percent
1.5 1.4 1.4 1.3 1.5
GDP 2647.90
USD Billion
3050 3050 3050 3050 3290
GDP Constant Prices 492674.00
GBP Million
492820 494800 496400 498840 512230
Gross National Product 498854.00
GBP Million
506570 509600 511400 515040 529390
Gross Fixed Capital Formation 84005.00
GBP Million
80210 80420 80670 80920 82940
GDP per capita 41602.98
USD
42600 42600 42600 42600 43870
GDP per capita PPP 38901.05
USD
40200 40200 40200 40200 41100
GDP From Agriculture 2619.00
GBP Million
3270 3290 3310 3330 3650
GDP From Construction 27628.00
GBP Million
26820 26860 27120 27410 29300
GDP From Manufacturing 44678.00
GBP Million
43050 43260 43540 43720 44700
GDP From Mining 5010.00
GBP Million
7650 7690 7720 7720 7990
GDP From Public Administration 19775.00
GBP Million
21420 21650 21780 21980 23400
GDP From Services 350445.00
GBP Million
342800 343600 344200 345700 374500
GDP From Transport 19400.00
GBP Million
18450 18560 18640 18720 19900
LABOUR Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Unemployment Rate 4.40
percent
4.4 4.4 4.3 4.3 4.7
Employed Persons 32147.00
Thousand
31450 31500 31750 31800 32800
Unemployed Persons 823.00
Thousand
810 811 812 815 829
Part Time Employment 8553.00
Thousand
8670 8700 8730 8760 8960
Full Time Employment 23654.00
Thousand
23610 23640 23660 23670 23990
Employment Rate 75.20
percent
75.7 75.6 75.5 75.2 74.6
Claimant Count Change -7.20
Thousand
16 11 9 10 6
Labor Force Participation Rate 78.80
percent
79.2 79.4 79.6 80 82
Long Term Unemployment Rate 1.20
percent
1.3 1.3 1.4 1.5 2
Youth Unemployment Rate 12.20
percent
11.4 11.2 11 11.2 11.9
Labour Costs 104.90
Index Points
105 105 106 106 110
Productivity 102.00
Index Points
105 105 106 106 110
Job Vacancies 810.00
Thousand
784 785 786 787 792
Wages 511.00
GBP/Week
512 514 516 518 536
Wage Growth 2.50
percent
2.3 2.3 2.4 2.4 2.8
Wages in Manufacturing 596.00
GBP/Week
597 599 601 603 617
Minimum Wages 7.50
GBP/Hour
7.5 7.83 7.83 7.83 8.5
Population 65.81
Million
66.29 66.29 66.29 66.29 67.16
Retirement Age Women 63.50
64 64 64 64 66
Retirement Age Men 65.00
65 65 65 65 66
Living Wage Family 1280.00
GBP/Month
1350 1350 1350 1350 1520
Living Wage Individual 970.00
GBP/Month
1170 1170 1170 1250 1470
Average Weekly Hours 31.90
Hours
32.2 32.2 32.2 32.2 32.3
Employment Change 88.00
Thousand
0.5 0.5 0.4 0.6 0.4
Wages Low Skilled 1330.00
GBP/Month
1350 1350 1350 1350 1550
Wages High Skilled 2210.00
GBP/Month
2360 2360 2360 2360 2490
PRICES Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Inflation Rate 3.00
percent
2.8 2.7 2.5 2.4 2
Inflation Rate Mom -0.50
percent
0.3 0.3 0.4 0.3 0.5
Consumer Price Index CPI 104.40
Index Points
111 114 116 119 134
Harmonised Consumer Prices 104.40
Index Points
111 114 116 118 132
Core Consumer Prices 104.30
Index Points
111 113 115 118 133
Core Inflation Rate 2.70
percent
2.5 2.4 2.3 2.3 2.2
GDP Deflator 104.63
Index Points
113 115 117 119 132
Producer Prices Change 2.80
percent
3 2.9 2.8 2.8 2.5
Export Prices 113.00
Index Points
95 93 94 93 95
Import Prices 111.10
Index Points
103 104 104 104 108
Food Inflation 3.70
percent
2.4 2.3 2.2 2.2 2
Inflation Expectations 2.90
percent
2.7 2.6 2.5 2.5 2.2
Producer Prices 112.40
Index Points
116 118 120 122 134
CPI Housing Utilities 103.10
Index Points
110 112 114 116 126
CPI Transportation 106.50
Index Points
111 113 115 117 123
MONEY Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Interest Rate 0.50
percent
0.5 0.75 0.75 1 2
Interbank Rate 0.56
percent
0.5 0.6 0.7 1 2
Money Supply M0 82115.00
GBP Million
93200 95600 97500 99500 122400
Money Supply M1 1708160.00
GBP Million
1865000 1889000 1955000 2029400 2510800
Money Supply M2 2347170.00
GBP Million
2455000 2510700 2562000 2732100 3129100
Money Supply M3 2814773.00
GBP Million
2947000 2999800 3063000 3110000 3420000
Foreign Exchange Reserves 164278.24
USD Million
164000 168000 172000 176000 205000
Banks Balance Sheet 3813163.00
GBP Million
3970000 4050000 4110000 4180000 4510000
Central Bank Balance Sheet 575645.00
GBP Million
560000 565000 570000 575000 600200
Loans to Private Sector 2381400.00
GBP Million
2420000 2440000 2414000 2510000 2720000
Deposit Interest Rate 0.25
percent
0.25 0.25 0.25 0.5 1.75
Lending Rate 0.75
percent
0.75 0.75 0.75 1 2.25
Private Debt to GDP 230.51
percent
234 234 234 234 230
TRADE Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Balance of Trade -4896.00
GBP Million
-2500 -2000 -1900 -1900 -400
Exports 52119.00
GBP Million
50600 51200 51500 51700 55700
Imports 57015.00
GBP Million
53100 53200 53400 53600 56100
Current Account -22784.00
GBP Million
-21210 -14640 -17500 -26770 -22840
Current Account to GDP -4.40
percent
-3.7 -3.7 -3.7 -3.3 -1.5
External Debt 6218711.00
GBP Million
6322000 6383000 6452000 6512000 6811000
Terms of Trade 101.70
Index Points
98.2 98.4 98.6 98.4 100
Capital Flows 16333.00
GBP Million
12100 15400 17900 40000 36900
Foreign Direct Investment 9488.00
GBP Million
44100 26300 -700 15200 15900
Gold Reserves 310.29
Tonnes
310 310 310 310 310
Crude Oil Production 884.00
BBL/D/1K
950 950 950 920 880
Terrorism Index 5.10
5.08 5.08 5.08 5.08 5.08
Tourism Revenues 1910.00
GBP Million
1400 2100 2500 2240 2490
Tourist Arrivals 3140.00
Thousand
2680 3460 3340 2810 2990
Weapons Sales 1393.00
USD Million
1351 1357 1363 1369 1533
GOVERNMENT Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Government Debt to GDP 89.30
percent
86.5 86.5 86.5 86.5 81.9
Government Budget -3.00
percent of GDP
-2.2 -2.2 -2.2 -2.2 -1.2
Government Budget Value 702.00
GBP Million
19700 21600 15980 9450 9980
Government Spending 92035.00
GBP Million
93300 93660 93800 93960 95590
Government Spending to GDP 42.10
percent
43.6 43.6 43.6 43.6 44.3
Government Debt 11620.00
GBP Million
-3250 -3970 -7850 -6130 -5460
Military Expenditure 54216.80
USD Million
53890 54133 54376 54619 56750
Asylum Applications 3070.00
persons
3070 3040 3070 2710 2210
Government Revenues 56253.00
GBP Million
57020 55960 53400 57890 61870
BUSINESS Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Business Confidence 13.00
Index Points
-7 6 5 4 2
Manufacturing PMI 55.30
57.2 56.9 56.6 54.3 53.1
Services PMI 53.00
Index Points
52.6 52.4 52 53.4 54.1
Industrial Production 0.00
percent
1.5 2 1.8 1.9 2.1
Industrial Production Mom -1.30
percent
0.3 -0.2 -0.1 0.3 0.3
Manufacturing Production 1.40
percent
2.1 2.2 2.3 2.8 2.3
Capacity Utilization 81.20
percent
82.6 82.7 82.7 82.8 82.7
New Orders 16699.00
GBP Million
14970 15000 15290 15450 16480
Factory Orders 10.00
Net Balance
4 6 5 -6 -2
Changes in Inventories -887.00
GBP Million
-85.37 -480 -177 -124 98.46
Bankruptcies 4382.00
Companies
3610 3580 3500 3600 4000
Corporate Profits 108691.00
GBP Million
112000 113000 114000 114000 121000
Zew Economic Sentiment Index -41.10
-28 -12 1 2 12
Car Production 100605.00
Units
161500 159400 162000 125000 132000
Car Registrations 163615.00
565000 261000 471000 190000 196000
Small Business Sentiment 23.00
5 4 6 5 2
Internet Speed 16920.86
KBps
18157 18290 18321 18296 16984
IP Addresses 27493519.00
IP
27386372 27271585 27191528 27093557 26436613
Private Investment 0.00
percent
0.6 0.7 1 0.7 0.5
Mining Production -14.30
percent
2.6 2.5 2.4 2.5 2
Steel Production 657.00
Thousand Tonnes
670 630 620 720 850
Competitiveness Index 5.51
Points
5.54 5.54 5.47 5.54 5.59
Competitiveness Rank 8.00
6 6 6 6 5
Composite Pmi 53.50
53.9 54 53.8 52.9 52.8
Corruption Index 81.00
Points
83 83 83 83 85
Corruption Rank 10.00
8 8 8 8 6
Ease of Doing Business 7.00
6 6 6 6 5
Electricity Production 26344.00
Gigawatt-hour
26800 24900 26000 30000 30200
CONSUMER Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Consumer Confidence -9.00
Index Points
-9 -7 -4 -1 2
Retail Sales MoM 0.10
percent
-0.3 0.4 0.2 0.7 0.5
Retail Sales YoY 1.60
percent
2.1 1.9 2.2 2.3 2.7
Consumer Spending 325695.00
GBP Million
315000 316000 317000 318000 323000
Disposable Personal Income 332445.00
GBP Million
302500 312600 317100 325100 364400
Personal Savings 5.50
percent
3 3.2 3.4 4.5 7.9
Bank Lending Rate 1.50
percent
1.25 1.25 1.25 1.5 2.25
Households Debt To Gdp 87.20
percent of GDP
88.5 88.5 88.5 88.5 82
Households Debt To Income 126.42
percent
130 130 130 130 132
Consumer Credit 1520.00
GBP Million
1570 1650 1770 1900 2430
Gasoline Prices 1.74
USD/Liter
1.63 1.63 1.57 1.56 1.48
HOUSING Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Housing Starts 41820.00
41050 43110 41740 38950 44750
Construction Output -0.20
percent
1.7 1.5 1.4 1.5 1.8
Housing Index 722.70
Index Points
751 763 774 785 890
Mortgage Approvals 61.04
Thousand
68.6 69.4 72.5 75.2 97.6
Mortgage Applications 36115.00
Units
43300 44600 45800 47600 52600
Home Ownership Rate 63.40
percent
64 63.1 63.1 63.1 61.5
Construction Orders 25.50
percent
2.6 2.9 2.5 1.8 1.4
Construction Pmi 50.20
53.6 53.7 53.2 52.9 52.4
TAXES Actual Q1/18 Q2/18 Q3/18 Q4/18 2020
Corporate Tax Rate 19.00
percent
19 19 19 19 17
Personal Income Tax Rate 45.00
percent
44 45 44 44 44
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 Q1/18 Q2/18 Q3/18 Q4/18 2020
Temperature 6.92
celsius
4.34 9.96 13.43 6.35 8.7
Precipitation 224.90
mm
101 73.51 95.45 126 101