Our monthly economic review is intended to provide background to recent developments in investment markets as well as to give an indication of how some key issues could impact in the future.
Overview
BOE UPGRADES GROWTH FORECAST
The Bank of England (BoE) has significantly increased its 2021 growth forecast, as survey evidence continues to highlight a strong economic rebound, fuelled by the easing of lockdown restrictions and rapid vaccine rollout.
INFLATION RATE RISES SHARPLY
UK inflation more than doubled in April and prices look set to continue climbing for the rest of this year, although policymakers generally expect such a rise to prove temporary.
MARKETS
Major global indices closed March in positive territory as recovery hopes continue. In the UK, the vaccine rollout continues at pace and the unlocking roadmap is progressing.
RETAILER OPTIMISM RISING
Major benchmarks closed in mixed territory at the end of May. In a largely subdued final day of trading ahead of the UK Spring Bank Holiday weekend, the domestically focused FTSE 250 closed the month on 22,683.95, a monthly gain of 0.83%, the FTSE 100 registered a modest gain of 0.76% in May, to close on 7,022.61. The Junior AIM index closed on 1,256.11, a loss of 2.23% in the month.
JOBS MARKET: ‘EARLY SIGNS OF RECOVERY’
The latest set of labour market statistics revealed a further fall in the rate of unemployment as well as another increase in the total number of job vacancies.
SALES SOAR AS SHOPS REOPEN
Official retail sales statistics revealed a surge in spending during April as non-essential shops reopened, although survey data suggests demand may have since returned to more normal levels.