GIMA Pulse Date of Report: 04/07/2017 a monthly snapshot of the UK Economy from

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1 GIMA Pulse Date of Report: 04/07/2017 a monthly snapshot of the UK Economy from Summary The factor with the largest percentage change over the last month is crude oil prices. Having lost its grip on the oil market, OPEC have lowered prices to undercut other suppliers. It is uncertain as to whether this will continue however recent polls of analysts, fund managers and other reputable sources suggest that while prices might not necessarily continue to fall, it is very unlikely that they will begin to rise any time soon. UK savings are at a record low as income levels are falling, thus decreasing the amount of disposable income. This fall in incomes caused retail sales to fall this month but growth in the business services and finance sectors helped to offset slower consumer expending to an extent. Unemployment remains low with many big UK firms securing jobs as well as sourcing new jobs. Rolls- Royce have announced their biggest single investment in the UK in over a decade, around 150 million for a new test bed in Derby, securing 7000 jobs and creating up to 200. What's happened since last month? Index Period GDP DOWN 1.3% - to Euro DOWN 1.0% Jun-Jul to $ UP 0.3% Jun-Jul to Yen UP 2.1% Jun-Jul FTSE 100 DOWN 2.2% Jun-Jul FTSE 250 DOWN 3.5% Jun-Jul CPI UP 0.2% Apr-May RPI UP 0.2% Apr-May Retail Sales DOWN 1.2% Apr-May Mortgage Approvals NONE 0.0% Apr-May Unemployment NONE 0.0% Apr-May Energy Prices UP 0.3% Apr-May Crude Oil Prices DOWN 8.1% Apr-May Petrol Prices DOWN 1.9% May-Jun Diesel Prices DOWN 2.3% May-Jun Base Rate: 0.25% NONE 0.0% Jun-Jul Figures based on most recent month/period available. What's happened since this time last year? Index Period GDP DOWN 0.9% - to Euro DOWN 4.5% Jul-Jul to $ DOWN 2.5% Jul-Jul to Yen UP 7.5% Jul-Jul FTSE 100 UP 12.1% Jul-Jul FTSE 250 UP 17.3% Jul-Jul CPI UP 2.6% May-May RPI UP 2.3% May-May Retail Sales UP 3.8% May-May Mortgage Approvals DOWN 1.5% May-May Unemployment DOWN 0.3% May-May Energy Prices UP 2.8% May-May Crude Oil Prices UP 20.1% May-May Petrol Prices UP 4.9% Jun-Jun Diesel Prices UP 5.9% Jun-Jun Base Rate: 0.25% DOWN 0.25% Jun-Jun Figures based on most recent month/period available

2 GDP 2.00% 1.50% 1.00% 0.50% 0.00% UK GDP 2017 Quarter UK GDP % % % 1.40% 1.80% 1.10% 0.40% 0.30% 1.50% -0.10% 0.40% 1.10% 1.50% 0.60% 1.50% % -0.50% GDP as percentage growth/decline against previous quarter Exchange Rates Month /Euro /US $ /Yen Exchange Rates -Last 2 Years Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Sep-17 Feb /Euro /US $ /Yen Exchange Rate / 100 (for chart) Mar Apr What 1 buys in Euros / $ / Yen Source: Bank Of England May Figures from 1st of each month Jun Jul Last Month % -1.0% 0.3% 2.1% Exchange Rates -Last 3 Months /02/ /03/ /03/ /04/ /05/ /05/ /06/ /07/2017 /Euro /US $ /Yen Exchange Rate / 100 (for chart) Source: Bank Of England Date /Euro /US $ /Yen 27/02/ /03/ /03/ /03/ /03/ /04/ /04/ /04/ /04/ /05/ /05/ /05/ /05/ /05/ /06/ /06/ /06/ /06/

3 FTSE 100 & FTSE 250 LAST 2 YEARS Month FTSE 100 FTSE 250 Aug-15 6,689 17,670 FTSE Indices -Last 2 Years Sep-15 6,059 16,840 Oct-15 6,076 16,764 21,000 Nov-15 6,362 17,167 Dec-15 6,421 17,554 19,000 Jan-16 6,093 17,122 Feb-16 6,060 16,489 17,000 Mar-16 6,147 16,729 Apr-16 6,146 16,844 15,000 May-16 6,186 16,730 Jun-16 6,192 17,061 13,000 Jul-16 6,578 16,465 11,000 9,000 7,000 Aug-16 Oct-16 Dec-16 6,694 6,984 6,753 17,139 18,184 17,497 Sep-16 Nov-16 Jan-17 6,746 6,917 7,178 17,850 17,523 18,141 5,000 Feb-17 7,108 18,240 Sep-17 Mar-17 7,383 18,983 Apr-17 7,323 18,972 FTSE 100 FTSE 250 May-17 7,250 19,805 Jun-17 7,544 20,011 Value at 23 Jun : 6,338 & 17,333 Source: London Stock Exchange Jul-17 7,377 19,320 Last Month % -2.2% -3.5% 7,700 FTSE 100 -Last 3 Months 7,500 7,300 7,100 6,900 6,700 6,500 6,300 14/02/ /03/ /03/ /04/ /05/ /05/ /06/ /07/2017 FTSE 100 FTSE 250 -Last 3 Months 20,000 19,800 19,600 19,400 19,200 19,000 18,800 18,600 18,400 18,200 18,000 14/02/ /03/ /03/ /04/ /05/ /05/ /06/ /07/2017 LAST 3 MONTHS Date FTSE 100 FTSE /02/2017 7,253 18,671 06/03/2017 7,350 18,881 13/03/2017 7,367 19,029 20/03/2017 7,430 19,160 27/03/2017 7,294 18,900 03/04/2017 7,283 18,954 10/04/2017 7,349 19,265 17/04/2017 7,148 19,298 24/04/2017 7,265 19,603 01/05/2017 7,250 19,805 08/05/2017 7,301 19,730 15/05/2017 7,454 19,751 22/05/2017 7,496 19,913 29/05/2017 7,526 19,992 05/06/2017 7,526 19,869 12/06/2017 7,512 19,683 19/06/2017 7,524 19,873 26/06/2017 7,447 19,685 FTSE 250 FTSE an index of the top 100 companies in UK FTSE an index of the top 250 companies in UK Source: London Stock Exchange

4 CPI - Consumer Price Index Month CPI (%) Jun % CPI (%) Jul % Aug % 3.50% Sep % Oct % 3.00% Nov % Dec % 2.50% Jan % Feb % Mar % 2.00% Apr % May % 1.50% Jun % Jul % 1.00% Aug % Sep % Oct % 0.50% Nov % Dec % 0.00% Jan % Feb % Mar % -0.50% Apr % CPI - inflation measure which examines weighted average of prices of a basket of consumer goods May % & services, such as transportation, food & medical care RPI - Retail Price Index Month RPI Jun % RPI Jul % 4.00% Aug % Sep % 3.50% Oct % Nov % 3.00% Dec % Jan % Feb % 2.50% Mar % Apr % 2.00% May % Jun % 1.50% Jul % Aug % 1.00% Sep % Oct % Nov % 0.50% Dec % Jan % 0.00% Feb % Mar % Apr % RPI - inflation measure which is broadly the same as CPI but also includes home costs May % e.g. mortgage repayments/rent/council tax Retail Sales Month billion Seasonally Adjusted Values May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Dec-14 Nov Dec billion Trend Jan Feb Total Retail Sales Excluding Automotive Fuel Mar Figures based on weeks; every 3rd month is a 5-week month Apr May Year-On-Year Change billion 3.83%

5 Mortgage Approvals Month Approvals Approvals Jul-15 67,500 Aug-15 69,500 80,000 Sep-15 71,500 Oct-15 70,000 75,000 Nov-15 70,500 Dec-15 71,000 70,000 Jan-16 71,000 Feb-16 73,500 65,000 Mar-16 73,000 Apr-16 70,000 May-16 66,000 60,000 Jun-16 66,000 Jul-16 64,000 55,000 Aug-16 61,500 Sep-16 61,000 50,000 Oct-16 67,000 Nov-16 67,500 45,000 Dec-16 67,500 Jan-17 68,500 Feb-17 67,500 40,000 Mar-17 66,000 Apr-17 65,000 Total number of mortgage approvals by banks in UK Source: Bank of England May-17 65,000 Last Month % 0.0% Unemployment Unemployment 5.80% 5.60% 5.40% 5.20% 5.00% 4.80% 4.60% 4.40% 4.20% 4.00% Unemployment as percentage of available workforce; figures relating to quarter ending in month shown Month Unemployment Jun % Jul % Aug % Sep % Oct % Nov % Dec % Jan % Feb % Mar % Apr % May % Jun % Aug % Sep % Oct % Nov % Dec % Jan % Feb % Mar % Apr % May %

6 Energy Prices Month Price Index Price Index Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Based on starting index of 100 in 2010 Apr May Last Month % 0.3% Crude Oil Prices Month Oil Prices Oil Prices Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov-16 Jan Dec-16 Feb Mar Apr May Crude Oil Price Index; 2010=100 Last Month % -8.1% Automotive Fuel Prices Month Petrol Prices Diesel Prices Automotive Fuel Prices Jun Jul-15 Sep Aug-15 Oct Nov Dec Jan Feb Mar Apr-16 Jun May-16 Jul Aug Sep Oct Nov Dec Jan Feb Sep-17 Mar Petrol Prices Diesel Prices Apr May Road fuel prices; pump price pence/litre Source: gov.co.uk Jun First week of each month Last Month % -1.9% -2.3%

7 Forecasts Summary Economic forecasting is notoriously difficult and often depends on the mindset of the forecaster. However we have included some highlights below from the most recent quarterly Bank of England Inflation Report which provides a comprehensive analysis from many sources including their own. As shown in the charts below, it is expected that interest rates will edge slightly higher towards 0.5% over the next few years as inflation increases towards 3%. The following charts are re-produced from Bank Of England Inflation Report, May Next report will be available in August 2017 Forecast Interest Rates Chart shows latest forecast using solid line. UK interest rates likely to rise steadily to 0.75% by 2020 Sources: Bank of England, Bloomberg, European Central Bank (ECB) and Federal Reserve (ref 1.3p7) Forecast GDP Fan Chart shows highest probability in central darker band. GDP likely to show 1-2% growth over next 2-3 years. (ref 5.1p37) Conditional on the path for Bank Rate based on market yields and an unchanged stock of purchased assets, GDP grows at around 1¾% in the second and third years of the forecast period Calendar-year GDP growth rates of the modal, median and mean paths Forecast Inflation ref 5.Fp45 Fan Chart shows highest probability in central darker band. Government's 2% target is shown as horizontal line. Inflation likely to rise to 2-3% during 2017.