Philip Shaw Next Quotations

We are increasingly nervous about our call for a quarter-point rate cut in February, even if we are not ready to throw in the towel. Continued sluggish growth should mean the next couple of years see a degree of disinflation, justifying lower interest rates.

We think the chances of a hike next week are virtually zero.

Both the input price and prices charged components are up on the month as well so this reduces the chance that rates will come down over the next couple of months.

We think the door is still open for a cut in rates over the next two months, perhaps as soon as next month.

The next move in rates will be a cut. There is some uncertainty over whether rates will be brought down as soon as next month but we would not be at all surprised if it happens.

The Next statement has given a boost to general retailers and the Next share price in particular.

The fall in unemployment is a bit of a surprise. There are no signs for the time being that wage inflation is picking up although the numbers next month will be critical.

The economy has been growing at a sub-par pace for five quarters now and we cannot see that situation changing over the next year or so.

This underpins our view that interest rates will have to come down again although the MPC caution on inflation suggests that's not going to happen until early next year.

The main point though is that output growth has now been below trend for five quarters and we can't see that changing over the next year or so,