Moore pessimism on 2017 living standards
The latest economic forecasts for 2017 see living standards being hit harder as inflation outstrips the growth in average earnings by more than expected at the start of the year.
Each month, the Treasury publishes forecasts from around 40 City forecasters covering an array of economic statistics.
The range of forecasts for average earnings growth in January 2017 ran from a rise of 1.7% up to 3.9%, with a median rise of 2.5%. However by the September 2017 report the range had moved down to between 1.6% and 2.7% with a median of only 2.2%.
In January, the expected rises in inflation under the Retail Prices Index (RPI) — the measure favoured by union negotiators — the range of forecasts ran from a rise of 2.3% up to a rise of 5.2%, with a median rise of 3.4% in the fourth quarter of 2017.
However, the September report’s forecasts range between rises of 3.3% and 4.4%, with a median of 3.9%.
Simply put — there’s more pessimism on earnings and even more pessimism on prices.