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A Framework That Provides Clarity

During periods of “low visibility,” confusion reigns: for every indication of one trend, there seems to be a countertrend. The key is to glean from the collective wisdom of reliable leading indicators a clear signal that the economy is headed for a turn.

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Sep 30 2013

U.K. Risks Boom-Bust Cycle

Last fall, when there was widespread concern among the consensus about a “triple-dip” recession, ECRI correctly called the U.K.’s exit from its second recession in five years. Indeed, in its latest reading, growth in the U.K. Coincident Index climbed to a 70-month high, while GDP growth is perking up and construction output is booming. A key question at this juncture is how long the U.K. expansion can be sustained without triggering inflation under the Bank of England’s (BoE) highly accommodative monetary policy.

In this context, ECRI has completed an in-depth analysis of the U.K. economy, examining key drivers of economic growth as well as labor market conditions and inflation, especially in home prices. This analysis outlines the risks that the U.K. now faces, and also assesses how much leeway the BoE has to maneuver.

Related News & Events

Comments on Japan's Recovery

BBC September 26, 2013

ECRI's Lakshman Achuthan talks with the BBC about Prime Minister Abe's statement that Japan's economy is back on track. More

 

BBC Interview on Jobs

BBC September 6, 2013

ECRI's Lakshman Achuthan talks with the BBC to put today's jobs report in the context of larger trends. More