OECD warns inflation surge could undermine global recovery – business …

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UK house price growth accelerated again last month, as need holds up despite the end of the furlough job protection scheme and the stamp duty tax break this autumn.

The average UK house price rose by 0.9% in November, data released by Nationwide shows, following a 0.7% increase in October. This pushed the average house price 10% higher than a year ago.

House prices are now almost 15% above their level in March 2020 when the pandemic hit the UK, Nationwide says, as the move to homeworking drove people to seek larger homes in more rural areas.

Nationwide house price survey

Photograph: Nationwide

Robert Gardner, Nationwide’s Chief Economist, says annual house price growth remained strong last month, despite a sharp drop in transactions in October after stamp duty rates returned to normal.


“There have been some signs of cooling in housing market activity in recent months. For example, the number of housing transactions were down almost 30% year-on-year in October. But this was almost unavoidable, given the expiry of the Stamp Duty holiday at the end of September, which gave buyers a strong motive to bring forward their buy to avoid additional tax.

“Indeed, activity has been extremely buoyant in 2021. The number of housing transactions so far this year has already surpassed the number recorded in 2020 with two months nevertheless to go and is truly tracking close to the number seen at the same stage in 2007, before the global financial crisis hit.

UK housing transactions

Photograph: Nationwide

The cut in stamp duty on house purchases in England and Northern Ireland finished at the end of September, having wrapped up earlier in Wales and Scotland.

UK mortgage approvals dropped to their lowest level since mid-2020 in October, but Gardner argues that inner activity appears to be holding up well, with approvals running above the 2019 monthly average.

Early indications also suggest that labour market conditions keep strong, despite the furlough scheme finishing at the end of September, he adds:


If this is maintained, housing market conditions may keep fairly buoyant in the coming months, especially since the market has momentum and there is scope for current shifts in housing preferences, as a consequence of the pandemic, to continue to sustain activity.

UK mortgage approvals chart

Photograph: Nationwide

More to follow…

Also coming up today

Healthchecks on factories in the UK, eurozone and the US will show how manufacturers fared last month, in the confront of current supply chain problems and the rise in Covid-19 situations in some countries.

Already today, manufacturing surveys from across Asia have shown activity stabilized last month amid easing lockdown and border restrictions.

The financial markets keep volatile, with shares expected to rise this morning after being hit by worries over the Omicron variant yesterday.

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December 1, 2021

Stocks were also hit yesterday by Jerome Powell, after the Fed chair suggested America’s central bank could wind down its bond-buying stimulus package faster than expected, to combat inflation.

Ipek Ozkardeskaya, senior analyst at Swissquote, explains:


Inflation is ‘not transitory’ said the Federal save (Fed) Chair Jerome Powell at his testimony before the Senate yesterday, and the stock markets took the ‘no transitory’ phrase as a slap in the confront. Most equities dived yesterday, as many didn’t expect to hear a hawkish Powell at a time the new omicron wave threatens the economic recovery.

We now know that Jerome Powell thinks ‘it’s appropriate to discuss whether it will be appropriate to wrap up the QE purchases a few months earlier’, at the next FOMC meeting which is a associate of weeks from now, and an earlier end of the QE program would also average an earlier hike of interest rates, already though Powell wants investors to dissociate the link between the timing of the QE taper and the first rate hike.

The agenda

  • 9am GMT: Eurozone manufacturing PMI report for November
  • 9.30am GMT: UK manufacturing PMI report for November
  • 10am GMT: OECD to release its latest Economic Outlook
  • 1.15pm GMT: ADP survey of US private sector payroll changes in November
  • 3pm GMT: Fed chair Jerome Powell testifies to the House Financial sets Committee



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