Economic Week In Review | Issue 289 | 19 July 2021
Materials and currencies
Builders’ Merchants Federation | The BMF warned that a lack of HGV drivers has lengthened lead times.
Oil prices | Opec+ agreed to boost production into 2022, causing oil prices to fall slightly.
Sterling | The pound has dropped to a three-month low against the US dollar and fallen slightly against the euro as concerns increase over the lifting of Covid-restrictions in England.
Property and construction news
Build back better | 15 towns have been confirmed for the final funding allocations from the Towns Deal, each receiving around £20m for regeneration projects.
High streets | The prime minister will outline plans to regenerate high streets this week by expanding outdoor dining and investing in sports facilities.
HS2 | The mayor of the West Midlands has suggested that there is a better case for connecting towns in the Midlands, rather than the eastern leg of HS2
Roads programme | The Office of Rail and Road’s annual assessment warned that whilst Highways England has met all targets so far, key future projects could be delayed due to planning issues.
Site Operating Procedures | The CLC says that whilst companies no longer need to follow SOPs facemasks should be worn in crowded and enclosed spaces.
Training | A lack of new recruits has encouraged The Skills Centre training specialists to offer guaranteed training and job interview opportunities at five sites. The specialist has partnerships with most major contractors.
Trading plans | The government will set out a plan to stimulate trade with 70 developing economies through lower tariffs and simpler rules today as part of the Developing Countries Trading Scheme. It builds on an existing scheme that Britain was part of whilst in the EU.
Tax | The Chancellor is drawing up options to raise tax to fund social care in England. It is thought that wider decisions on tax will be delayed until the spring Budget rather than at the autumn statement.
Consumer inflation reached 2.5% in June, its highest since 2018 and above the Bank of England’s target. Prices for food, fuel, second-hand cars, and clothing pushed the rate up.
Fiscal policy | A second member of the Bank of England’s Monetary Policy Committee has suggested that policy should be tightened to curb rising inflation.
USA inflation | Consumer inflation in America reached 5.4%, a 13 year high. Used cars and trucks accounted for more than a third of the increase.
Eurozone inflation fell to 1.9%. Core inflation was stable at 0.9% in June. The European Central Bank expects inflation to increase later this year.
Global debt | The Institute of International Finance has said that the global issuance of sustainable debt has passed $1tn with green bonds dominating the market, supported by companies that are under growing pressure from ESG commitments.
Published every six months, our Tender Price Index is an analysis of inflation price deviation in construction prices. Click on the link above to view our most recent Index.
Friday to Friday
Price / Index
Week % change
Annual % change
$ per £
€ per £
Brent Oil $/barrel
Inflation in both consumer and construction pricing has been low for some time so news of inflation increasing and surpassing the Bank of England’s target will be understandably unsettling and needs careful management. However, former IMF economist Kenneth Rogoff, suggests that a little inflation after a long period without movement may be a good thing, as it demonstrates that demand is increasing and the economy is rebounding. However, we would suggest that we need to pay close attention to the drivers of price increases in our market.
Given the dominance of public and infrastructure work in the construction pipeline, we will be closely watching these projects and the supply/demand impact they will have throughout the entire construction supply chain.
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