Tag Archives | stats

UK Inflation Rate and Graphs

Current UK Inflation Rate

  • CPI inflation rate: 0.0% (headline rate)
  • (page updated 25 March, 2015)


What is causing the fall in inflation?

  • Lower cost push inflation – falling oil prices
  • Other commodity prices also falling, such as metals, food.
  • Lower energy prices – gas and electricity
  • Low worldwide inflationary expectations. Europe is experiencing deflation and this is keeping inflation low.
  • Supermarket price wars, with big chains, such as Tesco and Sainsbury attempting to maintain market share from Pound Shops and discounters like Lidl
  • Wage growth still weak, despite early signs of some wage growth.
  • Note: RPI inflation is still 1.0%. Also, core inflation stripping out volatile items such as petrol, oil and energy prices is higher than the headline CPI rate.

Historic inflation


The current UK inflation rate compares favourable to much of the post-war period. The 1970s frequently saw double digit inflation. In 2014, the annual RPI was 2.2%.

See also: more historical graphs of inflation

Inflation since 1990



  • CPIH – 0.3% in the year to Feb 2015

CPIH is a new experimental index from the ONS. It is based on CPI, plus it includes housing costs, such as mortgage interest payments. Owner occupiers cost (OOH) account for 12% of the CPIH weighting. Mortgage interest payments are the biggest part of OOH. Mortgage interest payments average 10% of household expenditure.


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UK Housing Market Stats and Graphs

A look at the main UK housing market data.

  1. House prices
  2. Affordability of housing
  3. Interest rates
  4. Supply of housing

House price inflation


Nationwide data

  • Annual house price inflation running at 8.3% in Nov 2014
  • London showed strongest housing market with prices rising 21%
  • Price of a typical home is £188,810 (Dec 2014)

UK House prices in past few decade


  • In 1975, average house prices were: £10,388.
  • In 2014, average house prices are: £188,810.

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Savings ratio UK

  • Definition of Household savings ratio: The percentage of disposable income that is saved. (1)
  • Total savings = Disposable income – Household consumption

UK Saving Ratio

Latest UK household savings ratio: Q2 2014 = 6.7


UK Saving ratio source: National income accounts Q4 ONS

Note: stats were revised upwards in a recent update.

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Economic Growth UK

  • Economic growth measures the change in real GDP (national income adjusted for inflation; ONS call it chained volume measure of GDP)
  • In 2013 – annual GDP in volume terms increased by 1.7% in 2013.
  • In the past 12 months – between Q2 2013 and Q2 2014, GDP in volume terms increased by 3.2%
  • The peak to trough fall of the economic downturn in 2008/2009 is now estimated to be 6.0%
  • In 2013, GDP at market prices was £1,713,302 million (£1.7 trillion)
  • Updated October 6th, 2014

Recent UK Economic Growth


Source: ONS IHYQ

Raw data:  National income accounts | real GDP | % change quarterly

Recent history of economic growth

  • Since the recession of 1992 ended, the UK experienced a long period of economic growth – it was the longest period of economic growth on expansion. Also, the growth avoided the inflationary booms of the previous decades. However, the credit crunch of 2007-08 hit the UK economy hard and caused a steeper drop in real GDP than even the great depression of the 1930s. Helped by a loosening of monetary and fiscal policy, the UK experienced a partial recovery in 2010 and 2011. But, by Q1 2012, the UK was back in recession.
  • The second double dip recession was caused by a variety of factors including European recession, lower confidence caused by austerity measures, continued weakness of bank lending and falling real incomes.
  • Since the start of 2013, the UK economy has experienced positive economic growth – one of the relatively best performances in Europe. However, real GDP is still fractionally below it’s pre-crisis peak of 2007.
  • The recovery has been stronger in the service sector than manufacturing and industrial output. There are fears the UK recovery is still unbalanced – relying on government spending, service sector and ultra-loose monetary policy.

It is worth bearing in mind that sometimes economic growth statistics get revised at a later stage.

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UK Bond Yields Explained

UK bond yields are the rate of interest received by those holding Government bonds.

Governments sell bonds (via the Debt Management Office DMO) to fund their budget deficits. Bonds are a way for the government to borrow – a bit like the government taking out a loan.

Government bonds are frequently traded on bond markets. Therefore, their market price may be quite different to the original price set by the government.

Example. A government may sell a 10 year, £1,000 bond at 5% interest. This means every year year the government will pay £50 to the holder of this bond.

  • If demand for government bonds rose, this £1,000 bond would increase in price as investors pushed up the market price.
  • But, the government still pay £50 a year interest until maturity. If the market price of the bond rises to say £2,000, the interest rate (yield) is now 2.5% (50/2000)
  • Therefore higher demand for bonds leads to lower bond yields.
  • Conversely if people sell bonds, this pushes up the bond yield (e.g. what happened in Greece)

Recent UK Bond Yields

Source: Bank of England – 10 year bond yields

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UK Balance of Payments

The Balance of Payments is the record of a country’s transactions / trade with the rest of the world.

The balance of payments consists of:

  1. Current Account (trade in goods, services + investment incomes + transfers)
  2. Capital Account / Financial Account (capital and financial flows, net investment, portfolio investment)
  3. Errors and omissions. It is hard to collect all data so some is missed out.

In theory there should be a balancing between capital and current / financial account. If there is a current account deficit, there should be a surplus on the capital / financial account.

UK Current Account

The UK current account deficit wa s£20.7 billion in Quarter 3 2013, up from a revised deficit of £6.2 billion in Quarter 2 2013. The deficit in Quarter 3 2013 equated to 5.1% of GDP at current market prices, up from 1.5% in Quarter 2 2013 (page updated 8th Jan. 2014)

In 2012, the UK’s current account deficit was £59.8 billion.


Source: ONS Balance of Payments Current account as % of GDP

This shows a deterioration in the current account. The current account deficit for Q3 2012 was over £12bn (Seasonally adjusted measure). Q3 2012 as a % of GDP 3.2%

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Finding economic stats and data at ONS and Bank of England


Quick links for main economic statistics

My page with graphs Main ONS dataset Useful direct links
Economic growth National income acc Real GDP | % quarterly
Inflation inflation series CPI annual %
Unemployment Labour market ILO %
Current account b of p pnbp C.A % GDP
Budget deficit psf at ONS | psf at HM T PSNB % GDP
Public sector debt psf at ONS PSND % GDP
Labour productivity prdy dataset lab. prod. % change
Saving Ratio Nat.l inc. acc: J3 household savings %
Business investment Business investment
Housing market Nationwide data house price index ONS
UK wage growth average earnings S.A % change
Industrial + manuf output industrial production index of output

Bank of England data
UK Bond yields Bank of England 10 year bond yields
Exchange rates Sterling exchange rate
Money supply (BM4 at B of E)

Other data

Readers Questions: I’m pretty good at finding data at FRED. But I have no luck finding what I want at ONS. Do you have a post on that? Or some guidelines that might help me? Would be great!

It’s a good question. I’ve spent the past four years finding my way around the ONS database and website (and updating links the last time they changed URLs). I’ve spent many hours looking for certain statistics. The good news is that nearly all the important ones are there, if you dig hard enough. Though some data like exchange rates, bond yields, interest rates and money supply you will need Bank of England database.

Sometimes it’s frustrating because all you want is the % change in real GDP, and you have to wade through statistics on S.A Output in fishing and forestry.

A few points.

  1. If you get stuck, ONS have been very helpful in pointing out to me the relevant page. So it might be worth using the contact page, if you do get stuck
  2. Sometimes, the hardest thing is knowing where to find a statistic. For example, finding the savings ratio was difficult, because it’s not intuitive you need to look in National accounts – Household sector – saving ratio
  3. In some cases, other sources of data are better, e.g. for housing I still think Nationwide is better than the ONS, though the ONS seem to be giving housing more importance.
  4. It’s also worth checking out:

Tips on getting data

I subscribe to the ONS RSS feed so I can see when new publications come out.

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Economic Growth UK

  • Economic growth measures the change in real GDP (national income adjusted for inflation, ONS call it chained volume measure)
  • Economic growth in Q1 2013 was 0.3% (preliminary estimate). GDP was 0.4% higher in Q1 2013 than in Q3 2011 and therefore the economy has been broadly flat over the last 18 months (ONS)

Recent UK Economic Growth


Source: ONS

Raw data:  National income accounts | real GDP | % change quarterly |

National income accounts

  • The UK entered recession in 2008. We experienced a partial recovery in 2010 and 2011. But, by Q1 2012, the UK was officially back in recession.
  • Economic growth in Q3 2012 was 1.0% – helped by an Olympic ticket sales boost.
  • But, in Q4 2012, the economy went back into negative growth. Manufacturing fell 1.5%, service sector growth was flat, and construction rose 0.3% in the final quarter. In
  • In Q1, 2013, growth was 0.3% narrowly avoiding a triple dip recession.

It is worth bearing in mind that sometimes economic growth statistics get revised at a later stage.

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Investment in UK – Business and Public Sector


Total UK Business investment, slow recovery from 2009. (seasonally adjusted, Current Prices)

business investment growth

Source: ONS Q3 2012

An unconvincing recovery in business investment.

But still, business investment increased by £1.3 billion (4.5 per cent) when compared with the third quarter of 2011.

The outlook for business investment remains muted:

  • Despite low interest rates, banks are maintaining strict lending criteria and rationing finance. Many small and medium sized firms still state finance is difficult to come by.
  • Prospects for economic recovery are poor. The Bank of England’s latest inflation report painted a gloomy picture of an economy struggling to post positive economic growth.
  • With more austerity to come, business and consumer confidence is low.
  • Some reduction in producer price inflation has increased the profitability of business investment. However, commodity prices are volatile and there is no guarantee this low input inflation will continued.
  • Euro-zone debt crisis and EU recession also weigh heavily on UK investment decisions.

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Global Health Care Costs

A look at the contradiction between health care spending and actual treatment. The US which spends more on private sector health care spending, still also has one of the highest levels of government spending on health care per capita. Furthermore, health care costs continue to rise, and place one of the greatest strains on government spending commitments in the developed world.

total health care spending - list of countries

This graph shows total health care expenditure (including both public and private spending). The biggest spender by a long way is the US, which spends over $8,000 per capita. This compares to less than $3,000 per capita for Italy, Greece and Portugal.

Hospital Beds per 1,000 Population density


Admittedly, the number of hospital beds per 1,000 of the population is not a comprehensive guide to the quality of health care. But, it is still interesting that the US has one of the lowest numbers of hospital beds per 1,000 (3.1) – despite the much higher total spending. Japan has the highest number of hospital beds at 13.7/1000 – yet quite a modest total health care bill.

On other measures, US seems to get poor performance from its spending.

% of health care spending as % of GDP Govt spending as % of total health care Per Capita expenditure 2006 (PPP) Doctors per 10,000 population Nurses / midwives per 10,000 Hospital beds per 10,000 Life Expectancy male obesity
UK 8.2 87.3 2815 23 128 39 80 22%
US 15.3 45.3 6719 26 94 31 78 31%

US v UK health care costs)

Rising Health Care Costs

source: KFF

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