April 26, 2021
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UK: election raising indyref2 risk

  • The SNP has used Brexit as a pretext for a second independence referendum request, but the new realities of UK-EU relations fundamentally change the debate.
  • If a clear majority of MSPs elected to the new Scottish Parliament on 6 May favour independence, the perceived risk premium around indyref2 is likely to rise.

April 23, 2021
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UK: retail keeps volatility for recovery

  • UK retail sales rebounded by 5% m-o-m in Mar-21, recovering half of its decline since Oct-20 and beating consensus expectations. GDP has been less sensitive to lockdown on the downside so is set to rebound less in the recovery.
  • Businesses have been slow to re-open with only 1.6% resuming trade in the month to 18 April and a third of the accommodation and food sector still closed. Hopes are high for the next fortnight. Rejoice - UK mobility is above the most depressed half of the world.

April 21, 2021
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UK: subdued reflation pressures in Mar-21

  • Inflation disappointed expectations again in Mar-21 as it only increased to 0.7% y-o-y on the CPI and 1.5% on the RPI, although the latter was precisely in line with our forecast (index at 296.9). Food and recreation prices were the main sources of weakness.
  • The CPI outlook seems slightly softer than we previously thought. Further increases remain likely, aside from a July blip, with the peak slightly over 2% in Nov-21. Subdued median inflation suggests underlying pressures are not reflating excessively.