London Daily

Focus on the big picture.
Friday, Sep 11, 2026

Londoners brace for blockbuster economy week with interest rate hike and prices  data

Londoners brace for blockbuster economy week with interest rate hike and prices data

Bank of England tops the bill in a key week that will set the tone for the economy and consumers into 2023
Londoners are facing a blockbuster week for the economy, one which will set the tone for homeowners, consumers and investors alike into 2023.

We will find out if there is hope that inflation may have peaked in the run up to Christmas during a cost-of-living crisis with interest rates poised to go up, and there will also be numbers on joblessness and average earnings.

The Bank of England is top of the bill, with its December announcement on interest rates at high noon on Thursday. A hike is all but certain and will pile pressure on mortgage holders, with policymakers determined to tame double-digit inflation.

City experts agree that the only question is how big the Monetary Policy Committee’s hike will be after it voted for 0.75% last time, which took base rates to 3%. Andrew Goodwin, chief UK economist at Oxford Economics predicts a “pivot back to a 0.50% rise,” adding:

“There’s a good chance a minority of members will support a smaller rise or even keeping rates unchanged, which would support our view that investors remain too bullish on how high rates will peak.” Markets currently expect the BoE’s base rate to top out between 4.5% and 4.75% as the MPC tries to bring inflation down toward its 2% target

Its nine members will have plenty to discuss before their rate vote from a slew of important numbers due out earlier in the week.

First up is the monthly number on the size of the economy. Due on Monday at 7 a.m., the gross domestic product reading tracks the value of all the goods and services produced in the UK and will shed further light on whether it is already in recession.

The widely accepted recession definition kicks in with two consecutive quarters of contraction. After a decline in the third quarter, the data won’t take the UK past that line until the end of December. But the October numbers will offer another signpost on the journey, with many economists already convinced recession has arrived, while the Bank of England itself says it is on the way.

According to forecasts from Deutsche Bank, October GDP will rise by 0.4%, bouncing back from a drop of 0.6% in September, which was largely driven by the public holiday held for the funeral of Queen Elizabeth II.

Sanjay Raja, chief UK economist at Deutsche, predicts that when fourth quarter data arrives, it will indicate recession, which he expects ”to last four quarters, with GDP shrinking by around 1.5% peak-to-trough.” He adds: “The ongoing cost of living crisis, elevated economic uncertainty, and rising cost pressures all point to a deteriorating outlook in the months ahead.”

So far, the jobs market has been resilient during the downturn. Employment data, out on Tuesday at 7 a.m., is expected to show a relatively low jobless rate at 3.6%. Average earnings data will be paid close attention by the BoE as it fights inflation. HSBC estimates that the weekly rise in pay will reach 6.2%

Wednesday will also be a busy day, bringing headline inflation data for November. HSBC expects it ease back slightly to 10.9% from 11.1% in October. But that will leave it significantly above the BoE’s official target of 2%, leaving the way wide open for rate hikes.

But James Hughes, chief analyst at Scope Markets said: “It’s vital to remember that the inflation we saw a year ago has not been sustained. Wheat and crude oil are now back at level seen before the Russian invasion of Ukraine, suggesting that some significant contraction will be seen here in the next few months.”

By the end of a stellar week for economic data, Londoners should have a clearer picture of where they stand in terms of recession, the cost-of-living crisis and the outlook for interest rates and mortgage costs.
Newsletter

Related Articles

0:00
0:00
Close
English Councils to Gain Power to Introduce Tourist Taxes by 2028
Kemi Badenoch Reshuffles Conservative Shadow Cabinet
Firefighters Make Progress Containing Major Wildfires in South Wales
John Lewis Partnership Reports £124 Million Loss
Study Says UK AI Data Centres Will Create Only a Quarter of Forecast Jobs
UK Government Considers Higher Industrial Water Prices Amid Supply Pressures
Andy Burnham Holds First Call With Donald Trump as UK Prime Minister
NHS Records Busiest Summer on Record as Heatwaves Drive Hospital Admissions
Home Secretary Orders Police Crackdown on Far-Right Anti-Migrant Vigilantes
UK Supreme Court Rules Northern Ireland Religious Education Curriculum Breaches Human Rights Standards
Markets Price in Four Bank of England Rate Rises by Next Summer
House of Commons Prepares Free Vote on Assisted Dying Bill
UK Government Bans Trade With Israeli Settlements in Occupied Territories
UK Economy Grows 0.4% in July as Artificial Intelligence Investment Supports Expansion
Andy Burnham Becomes UK Prime Minister After Keir Starmer Resigns
John Lewis Partnership Loss Widens to £124 Million
UK Government to Put White Working-Class Social Mobility at Centre of Equality Policy
McLaren Plans £450 Million Technology Investment Creating 1,000 UK Jobs
UK Chancellor Faces Calls for Wealth Taxes and Public Ownership in Autumn Budget
English Mayors to Gain Powers to Impose Uncapped Overnight Tourist Taxes
JPMorgan’s Jamie Dimon Warns UK Government Against Bank Windfall Taxes
UK Air Traffic Control Outage Cancels More Than 2,000 Flights
UK Imposes Trade Ban on Israeli Settlements in the West Bank
UK Borrowing Costs Surge as Middle East Tensions Push Long-Term Gilt Yields to Highest Since 1998
Buckingham Palace Says Prince Harry and Meghan Will Not Resume Official Royal Duties
UK Treasury Faces Calls to Scrap £100,000 Childcare Support Threshold
Trades Union Congress Urges Labour Government to Rewrite Migration Policy
Riot Police Deployed After Anti-Migrant Protests Turn Violent in Portsmouth
UK Considers Replacing Some Disability Cash Payments With Direct Services
JPMorgan’s Jamie Dimon Warns UK Chancellor Against Higher Banking Taxes
UK Announces New Sanctions Targeting Israeli Settlements in West Bank
Metropolitan Police Investigate Alleged Illegal Donations to Reform UK
UK Charges Wiltshire Man With Assisting Russian Intelligence
UK Orders Urgent Review After Air Traffic Failure Cancels More Than 2,000 Flights
Merz Rebukes AfD Expansion in Saxony-Anhalt
King Charles Confirms Prince Harry and Meghan Will Remain Private Citizens
Labour Selects Former Child Refugee for By-Election in Keir Starmer’s Former Seat
Foreign Private Equity Accelerates Takeovers of London-Listed Industrial Companies
NHS Maternity Care Faces Scrutiny Over Support for Mothers After Caesarean Births
BBC Warns Staff Strikes Are Likely Amid Job Cuts and Programme Cancellations
English Housing Affordability Improves to Best Level in More Than a Decade
UK Health Commission Proposes Framework for Wider AI Adoption Across NHS
Labour Faces Pressure for Wealth Tax Ahead of Autumn Budget
Metropolitan Police Open Criminal Investigation Into Alleged Foreign Donations to Reform UK
UK Police Deploy Riot Officers After Anti-Immigration Unrest in Portsmouth and Dover
UK Defends Sanctions on Israeli Settlements Despite Diplomatic Retaliation
UK Air Traffic Control Failure Cancels More Than 1,000 Flights and Disrupts 65,000 Passengers
Compass Urges £10 Million Wealth Tax and Public Ownership Ahead of UK Autumn Budget
UK Government’s Devolution Plans Face House of Lords Scrutiny
Maldives Seeks New Chagos Sovereignty Talks With UK Prime Minister Andy Burnham
×