UK economy bottoming out – but medium term remains challenging says Brian Hilliard

BRIAN Hilliard offered his own – sometimes individual take (“I’ve just paid £25 for a chicken at the supermarket for goodness sake!”) – economic outlook on the UK economy at the BVRLA Leasing Broker Conference (21 June 2023)

Speaking via computer conferencing, the Societe Generale’s chief UK economist said that the UK was bottoming out – but medium term remained challenging.

“We’ve probably managed to avoid recession, but it’s still tough for consumers,” he said, warning that insolvency rates, which were higher in 2022 than 2021, would likely increase again for 2023.

He also warned that money markets were ramping up mortgage rates following Bank of England rate increases. “This is a great worry,” he said. “Many mortgages might double or even treble. It’s a blow to consumers – it’s a very real problem. But there is a big pool of savings in the household sector particularly in the mid and higher income brackets.”

Brian added that while “consumer confidence is picking up after the Truss debacle there is still some way to go.”

He said that the economy would not be performing to its potential for another year, adding that the impact of the pandemic had been a super tightness of the labour market.