Chief Economist, Heteronomics

Phil Rush

Philip Rush is the Founder and Chief Economist of Heteronomics. Until launching in November 2016, he was Nomura's Senior European Economist and was the Chief UK Economist there since 2010. Before that, he was UK Economist at Barclays Wealth, where he also developed strategic asset allocation models for their market return portfolios. Philip started his career at Lehman Brothers covering the UK, Scandinavian and Swiss economies. A book on his fundamental framework was published in January 2018 as "Real Market Economics".

Chief Economist

UK: Disinflation During Lockdown Disaster

UK: Subdued Reflation Pressures in Mar-21

Heteronomics

Heteronomics represents a different kind of economics. We believe analysis should delve into the details of what is really going on, rather than using overly simplistic assumptions to quick-sell stories. Independence from myopic institutional pressures allows us to focus on the realities underlying your asset allocation decisions, without the conflicts of the old market structures. Heteronomics targets the themes driving UK asset prices, offering the benefits of depth, independence and ultimately price.

UK-centric macro research

Macroeconomics

<ul>
<li>Inflation exceeded consensus expectations again in Jan-21 while matching both our CPI and RPI forecasts of 0.7% and 1.4% respectively. Weighting changes were worth about 0.1pp to the CPI with the other 0.1pp caused by upside in furniture and restaurants.</li>
<li>The distortion in the UK was smaller than elsewhere in Europe because the weight on garments was raised rather than slammed down. This is likely to more than unwind next January if it's not corrected next month alongside the release of RPI weights.</li>
<li>A continued grind higher looks likely to occur in both Feb and Mar before inflation spikes back into the right ballpark of the target in April. We still expect a potential breach of the target in 2021, but for it to be of insignificant size and longevity.</li>
</ul>


Inflation exceeded consensus expectations again in Jan-21 while matching both our CPI and RPI forecasts of 0.7% and 1.4% respectively. Weighting changes were worth about 0.1pp to the CPI with the other 0.1pp caused by upside in furniture and restaurants.
The distortion in the UK was smaller than elsewhere in Europe because the weight on garments was raised rather than slammed down. This is likely to more than unwind next January if it's not corrected next month alongside the release of RPI weights.
A continued grind higher looks likely to occur in both Feb and Mar before inflation spikes back into the right ballpark of the target in April. We still expect a potential breach of the target in 2021, but for it to be of insignificant size and longevity.


UK: Inflation Up-Scaled in Jan-21