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: Buying Votes With Inflationary Policy

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>The BoE’s medium-term inflation forecasts have been grinding higher amid evidence of persistence from wages. Historical errors clustered in regimes lasting several years. </li>
<li>Inflation proved more predictable in 2023, with spot surprises no longer skewed so heavily. Still, the trend exceeded other expectations, and we expect a 2024-25 repeat.</li>
<li>Wage settlements are too high and reinforced by myopic government policy before the election. Second-round effects still delay rate cuts to 2025, in our view.</li>
</ul>


The BoE’s medium-term inflation forecasts have been grinding higher amid evidence of persistence from wages. Historical errors clustered in regimes lasting several years. 
Inflation proved more predictable in 2023, with spot surprises no longer skewed so heavily. Still, the trend exceeded other expectations, and we expect a 2024-25 repeat.
Wage settlements are too high and reinforced by myopic government policy before the election. Second-round effects still delay rate cuts to 2025, in our view.


UK Trend Inflation Problem