Page 56 - Minutes of meeting

P. 56

Macroeconomic drivers Since 2013 most indicators have performed

positively. An exception to this is productivity growth,
which has been more volatile. Unemployment has

The chart below shows the annual change of five key steadily reduced, inflation has consistently been
macroeconomic indicators since 2019 for the UK, with their projected close to the 2% target, with growth in earnings
change from 2020 as included in the recent Spring Budget. The generally keeping pace. Whilst GDP growth has
current forecasts do not account for the impact of Covid19. Whilst been modest by historic standards, it has been

the impact of the virus will be significant, these trends will remain consistently above 1% each year.
fundamental drivers of the economy in the long term. The current forecasts project these positive

outcomes to broadly continue. Unemployment will
remain virtually constant, earnings growth will grow
above inflation, and GDP and productivity will
continue steady growth.

However, the forecasts must be treated with some
caution, especially given the rapidly developing
impact of Covid-19 on the economy. Of the five
Historic
Projection indicators, a great deal of new uncertainty surrounds
GDP and productivity growth. This is because of the
compounding effect of both the virus and Brexit,
which will directly affect these indicators. Pre-virus,
GDP and productivity were projected to grow
between 1-2% each year to 2024, based on the
optimistic outcome of obtaining a free trade

agreement with the EU by the end of the transition
period.

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