Bank of England follows the Fed and holds its policy rate at 3.75% given uncertainty from the conflict in the Middle East. BoE hints it will be patient on raising rates but the bigger issue is its assessment of the impact of the war. Thread on all that to follow...

What happens when you increase the Irish talent at RF....kudos to @cillian-sheehan.bsky.social for this chart of the week to lighten the mood as beer garden weather finally kicks in.

Looking forward to this one already - that moment when your clever friend writes an awesome book and you get to interview them about it on stage! @soumayakeynes.ft.com www.resolutionfoundation.org/events/how-t...

Great event. It is hard to size economic effects through uncertainty but policymakers can't "wait and see" forever so we have to try. The Bank face their next decision in a month and the government has time before deciding whether to provide energy bill support.

For our chart of the week we've dug into the data on school absences. Worryingly, the rate of severe school absences is rising. And there's a lot of regional variation, with London performing significantly better. Read the full newletter from @ruthcurtice.bsky.social ⤵️ buff.ly/SdrRmBm

Pre-Middle East conflict UK economic data from ONS: GDP rose by 0.5% in February Unemployment fell from 5.3 to 4.9% in January Borrowing in February £1.9bn below the OBR forecast Positive trends now all at risk. No wonder the Chancellor is seething in Washington…

Good to see removing the Carbon Price Support form part of this. Something @resolutionfoundation.org suggested way back in 2023

@pjtheeconomist.bsky.social times column this week is an incredibly pithy (even by his standards!) summary of the issues and changes in working age welfare - including why spending on it isn't out of control.

Today we discussed new research from @resolutionfoundation.org co-authored with @gthwaites.bsky.social @annastansbury.bsky.social and Richmond Egyei on the long shadow that deep poverty in childhood casts over the earnings of graduates in the labour market. Thread below on what we found …

Important report out today. Child poverty isn't just bad, it causes a lasting earnings penalty. Perhaps some gap is not so surprising. But I was shocked by the scale of the penalty persisting even for children who go to university, get the same degree and work for the same firm.

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I've been wondering this week whether we are all (myself included) talking too much about energy prices and not enough about food.

Brilliant thread from Elliott unpacking this mornings public sector finances

Today’s labour market stats were better than expected – headline unemployment didn’t rise thanks to a surprise Jan single month number, and payrolled jobs rose. Real wages are still growing (slowly), but war in the middle east clouds the outlook there. Thread from me and @hannahslaughter.bsky.social

Bank of England keeps rates at 3.75% on a striking unanimous vote. All eyes on how the BoE might change tack in the face of renewed energy shock. Thread on that to follow…

Good session at the TSC's Inquiry into the OBR. Thanks to @julianhjessop.bsky.social for the football analogy that survived the whole evidence session. Think we ended up all agreeing on one thing: the referee is not mainly to blame for the low growth high debt situation the UK finds itself in.

The number of Mais lectures delivered by a woman currently rising by 25%. On that basis alone glad Rachel took two shots.

Disappointing UK GDP this morning with the economy flatlining in January. Bit surprising given survey suggesting a brighter start to the year. Outlook is now clouded by conflict in Iran. Plenty for the Chancellor to worry about as she prepares for next week's Mais lecture. Short thread to follow...

Really enjoyed recording this podcast with @gilesyb.bsky.social and @jamessmithrf.bsky.social . Check out our discussion of where the spring forecast leaves the UK and growth policy in particular.

In her speech yesterday, the Chancellor said the question people will be asking themselves at the next election is "are me and my family better off?" So what is the answer likely to be? 🧵

Despite insisting this was not a fiscal event, Government policy decisions added £5.7 billion to borrowing, mostly due to higher SEND spending. Ranking all fiscal events since 2010 by their impact on borrowing, today's Forecast is in the bigger half of fiscal events.

Live commentary on Chancellor's speech coming up. Expect to be told some version of "the plan is working" with themes on stable public finances, growth and cost of living. More unusually for only about 20 minutes!

Things to watch out for next Tuesday: GDP downgrade, unemployment upgrade, migration change. No red box but still a top panel to digest it all the next day!

📢 New price cap announcement this morning! Ofgem have confirmed there will be a 7 per cent fall in energy price cap in Q2 2026, boosting living standards for lower-income households. Find out more ⤵️ buff.ly/K29q0KX

A state of the (poorer half of) the nation debate! Great chat on social, political and economic change of the last generation with @ruthcurtice.bsky.social & Scarlett Maguire www.youtube.com/watch?v=42ft... (or Audio-only podcast here: resolutionfoundation.podbean.com/e/who-are-un...)

Today's consultation on SEND spending (assets.publishing.service.gov.uk/media/699862...) shows why policy announcements shd come with fiscal events. It *seems* to contain new money, but isn't clear how it will be funded or what it means for the fiscal rules. Thread on what is going on to follow...

Today's SEND announcements a good example of why it is best to make spending/tax announcements all together in a fiscal event. Lack of clarity about how much money is new (seems like £3.5bn is genuinely additional to previously announced totals), what it means for existing pressures or future years.

Why reliable data matters in one picture The UK's productivity performance is either: - still rubbish; or - improving greatly after a terrible spell You choose

UK inflation data out this morning shows a sharp, broad-based fall in CPI inflation from 3.4% in December to 3.0% in January - this is welcome good news. Inflation should now normalise rapidly in the coming months for the first time since before the pandemic. Thread to follow...

Good to hear that Millburn is being comprehensive in his review when he spoke on today programme this morning. Clearly, though, with today's stats demand for young workers is part of the problem - not just supply of them.

Big signing here for the government (and civil service) as Prof Brian Bell becomes Chief Economic Advisor at the Treasury. Brian will bring much-needed economic rigour and expertise, as well as adding A LOT of drive and energy to UK economic policymaking.

If you missed our packed Unsung Britain conference yesterday you can watch it back! www.resolutionfoundation.org/events/unsun...

🚨 New Living Standards Outlook published today! 🚨 This year will see a welcome boost to living standards... which we sadly expect to be short-lived. @louisemurphy.bsky.social explains 👇 buff.ly/siFTYAC

Read 200 pages of our new book here www.resolutionfoundation.org/publications... Or — if you’re in a rush — read @mikebrewerecon.bsky.social’s summary piece below, which does an amazing job of boiling the gist of it down to 900-odd words

Chart of the week gives you a sneak peak into 'Unsung Britain' – a new book we're publishing on Tuesday. It shows that in the six years leading to last autumn, annualised inflation experienced by the poorest families ran at a rate that was 0.7 percentage points faster than for the richest families

Fantastic thread from Simon on today's MPC decision

Today's report isn't usual territory, but does show our commitment to evidence. It would be easy to write a report saying protect consumers at all costs. Great analysis by @zackleather.resolutionfoundation.org persuaded us that wasn't the right answer. www.resolutionfoundation.org/publications...

We discussed this report with one of the architects of universal credit (Stephen Brien), a changing realities participant (Jonny Roberts) and a welfare rights adviser (Corin Hammersley). They all agreed that we need to continue to improve universal credit as roll-out completion finally completes.

Quick word on this morning's public finances data for the UK which were pretty much in line with expectations. Borrowing in December was £11.6bn, slightly lower than market expectations of £13.4bn. Year to date, borrowing is £140.4bn, which looks broadly consistent with the OBR's Nov forecast.

Not just Trump who's a year into a new job....clear highlight of my week so far. Tasted pretty good too.

Our polling finds once again the purveyors of division have it wrong. We're told that when it comes to Marmite you either love it or you hate, it but our polling finds just 43% of Britons fall into those camps. With as many expressing ambivalence, or a softer preference either way

Congrats to @instituteforgovernment.org.uk for an excellent conference today. I enjoyed Wes Streeting's suggested new year resolution for the government - girft or "get it right first time"...

How does the Government's rhetoric around the cost of living compare with the reality? Could we really be “turning a corner” in 2026, as Starmer hopefully proclaimed at PMQs? Read in full (and subscribe!) here, to find out how “£150 off Energy bills” works in practice ⤵️ buff.ly/wkw0Sqh

In lots of ways 2026 may well be a turning point - optimistically for productivity, for child poverty and for containing the size of the state. But the government will have to outdo the forecasts if it is to be a turning point for living standards especially with rising unemployment.

🎄It’s nearly Christmas which means it’s time for the Top of the Charts quiz of the year buff.ly/U64m34M 🎄 And you can read the Top of the Charts Christmas special now➡️ buff.ly/xZTJGCJ

As expected, BoE cuts rates by 0.25ppts to 3.75%, the sixth cut in this cycle on a tighter-than-expected 5-4 vote. Bigger question for today, though, is how BoE sees balance of stubborn inflation and a weakening labour market. A short thread on that to follow...

Labor markets weakness is all about uncertainty, not AI. www.richmondfed.org/research/nat...

@nyecominetti.bsky.social piece from yesterday important context for today's labour market stats. ALL of the change in the employment rate since the pandemic is due to unemployment - a lack of jobs not a lack of jobseekers.

Some worry that some non-working families will benefit from the lifting of the two child limit. But when you dig into the data, as we do in chart of the week, over 95% of the families who benefit are either working, have a child under 3, or have a family member with a disability.

Updated child poverty forecasts reflecting latest forecast and child poverty strategy. Poverty set to fall through the Parliament - we estimate by a chunky 300k but by a less chunky 1%. That's because the number of kids in the population is also falling.