Business
Slowdown in rising cost-of-living set for December pause, say economists
UK inflation could have ticked higher last month, as Christmas getaways helped fuel price rises at the end of the year, economists have said.
Some economists are expecting the rate of Consumer Prices Index (CPI) inflation to have risen in December after falling sharply the previous month.
Rob Wood and Elliott Jordan-Doak, economists for Pantheon Macroeconomics, said they were forecasting CPI to rise to 3.3% in December, from 3.2% in November.
A hike to tobacco duties, which was announced at the autumn budget in November, is set to have pushed up overall inflation during the month.
The price of plane tickets and hotels are also expected to have soared amid stronger demand for Christmas travel.
Analysts forecast that airfares could have jumped by about 30% between November and December.
But economists stressed that the choice of date for the Office for National Statistics (ONS) to collect the latest inflation data would be crucial, as prices would have differed throughout the month.
If it was collected later in the month, travel prices could have been much higher in line with the school holidays, pushing up the overall rate of inflation.
Andrew Goodwin, chief UK economist for Oxford Economics, said he thought the slowdown in the rising cost of living was “temporarily halted” in December.
He said: “Some of November’s downward pressure came from volatile categories, including clothing, airfares, and accommodation services, and this is likely to have unwound in December, although the choice of date for collecting the data will likely have a crucial bearing on the outturn for airfares.”
He is predicting a much sharper increase of CPI inflation to 3.6% in December.
On the other hand, analysts for Barclays said they thought inflation would remain unchanged at 3.2% in December.
They forecast energy price inflation to have slowed, while food and drink price rises to have steadied at the end of the year.
But experts said they thought inflation was still heading downwards this year.
Victoria Scholar, head of investment for Interactive Investor, said that “longer term, the trajectory for inflation is still on the downside, heading back towards the 2% target later this year”.
“November’s budget from the Chancellor was largely viewed as disinflationary owing to its contractionary fiscal measures, including tax increases and spending cuts,” she said.
“Plus, there are growing signs of slack in the labour market, also easing inflationary pressures in the UK economy.”
A “For Lease” sign in the Financial District of San Francisco, California, US, on Wednesday, May 3, 2023.
Jason Henry | Bloomberg | Getty Images
A version of this article first appeared in the CNBC Property Play newsletter with Diana Olick. Property Play covers new and evolving opportunities for the real estate investor, from individuals to venture capitalists, private equity funds, family offices, institutional investors and large public companies. Sign up to receive future editions, straight to your inbox.
Despite the war with Iran and continued economic uncertainty in the U.S., demand for office space is recovering at a strong clip.
In the first quarter of this year, new in-person and virtual office tours reached their highest level since the pandemic began, as measured by the VTS Office Demand Index. The index is a future indicator of lease signings about a year or more out.
The index rose 18% from the fourth quarter 2025 and 13% from the same quarter one year ago.
“Although tested against a turbulent backdrop, demand for office space has seen an exceptional start to the year,” Nick Romito, CEO of commercial real estate software company VTS, said in a release. “What perhaps is most notable about this quarter’s positive performance is that it was led not just by tech’s sustained AI boom – but also by finance and legal companies entering the market as well.”
The surge in demand is curious, given that office-using employment is still down 2% from 2022, according to the Bureau of Labor Statistics. Usually, that would result in less office demand, but the drop in employment could also be giving employers more leverage to get workers back into the office.
Nationally, for all buildings, the office vacancy rate fell 14 basis points to 22.2% in the first quarter of this year from the previous quarter and is down 30 basis points from the last peak in Q2 2025, according to a report from JLL, a commercial real estate services and investment management company. Vacancy remains hyper-concentrated predominantly in larger-scale, aging buildings with financially constrained owners, with 10% of office buildings comprising more than 60% of total national vacancy.
As with everything in real estate, the office recovery is local. San Francisco and New York City are leading office demand, as AI tech employment rises quickly in the former and diversity of employment fuels the latter. Los Angeles also saw double-digit increases in demand on a quarterly basis, fueled by significant growth in the creative industry, according to VTS.
Cities seeing weaker demand include Boston, which was the worst-performing market in the report. Life science offices have taken a hit in that city, due to significant government funding cuts.
In addition, demand is contracting in Seattle, Washington, D.C., and Chicago, as they are not seeing strong employment growth.
“The AI boom continues to be a dominant headline for office, and markets that lack a major tech presence, or are without a primary growth lever in another industry, are seeing declines in demand,” Ryan Masiello, chief strategy officer of VTS, said in a release. “LA’s positive performance this time around was a new bright spot – and it remains to be seen if Los Angeles can sustain growth in the near term.”
Protesters have forced NatWest to halt its shareholder meeting, as the bank’s chairman defended its climate policy in response to investors claiming it has “backtracked” on commitments.
The annual general meeting (AGM) was being held on Tuesday morning but had to be stopped for about half an hour amid disruption during chairman Rick Haythornthwaite’s opening speech.
Protesters were singing and making statements about NatWest’s climate policies.
The boss heard a statement presented by ShareAction, backed by investors managing 1.4 trillion US dollars (£1 trillion) in assets, including the Church of England Pensions Board, Greater Manchester Pension Fund and Rathbones Investment Management.
The statement said investors are “concerned by the bank’s changed outlook on climate change” having “reduced the ambition of its fossil fuel policy and climate targets”.
“The bank dropped its commitment not to finance oil and gas majors lacking a credible transition plan or failing to report their overall emissions,” it said.
It called for Mr Haythornthwaite to meet the group of shareholders to discuss the bank’s climate strategy.
Campaigners including ShareAction are also calling for shareholders to vote against the re-election of the bank’s chair over concerns of climate backtracking, which the Church of England’s pensions body said it plans to do.
Mr Haythornthwaite responded to the statements saying that he “takes climate change very seriously, as does all of this board” and that he was happy to meet the group.
“We’ve had to wrestle with the questions of how do we balance supporting our customers in their transition efforts with managing the risks in what is an increasingly complex policy environment,” he said.
He stressed that the bank’s “overwhelming” balance of lending was on renewables and that oil and gas financing comprises 0.6% of total lending.
NatWest also retained targets to at least halve the climate impact of its financing activity by 2030, against a 2019 baseline.
“I don’t want to take what sounds like a backtracking as a major shift,” Mr Haythornthwaite said, adding that “these targets matter”.
The battle between the AI big hitters has largely played out on social media. Now it is coming to the courtroom.
Source link
Japan’s apparel imports rise 2.8% to $24.3 bn in FY 2025-26
Get Ready for More Brain-Scanning Consumer Gadgets
Office demand rebounds to highest level since Covid pandemic began
-
Sports1 week agoNCAA men’s gymnastics championship: All-time winners list
-
Sports1 week agoWWE WrestleMania 42 Night 2: Live match results and analysis
-
Fashion1 week agoUK’s Sosandar returns to profitability amid robust FY26 performance
-
Politics1 week agoUK’s Starmer seeks to deflect blame over Mandelson appointment
-
Business1 week agoNo fuel shortage: Govt assures 100% domestic LPG, PNG, CNG supply amid Hormuz energy crunch – The Times of India
-
Entertainment1 week agoLee Anderson, Zarah Sultana kicked out of UK Parliament for calling PM ‘liar’
-
Business1 week agoHow Trump’s psychedelics executive order could unlock stalled cannabis reform
-
Sports1 week agoQuetta Gladiators opt to bowl after winning toss against Peshawar Zalmi in PSL 11 clash