Within the last hour the Bank of England has downgraded its growth predictions in its latest overview of the financial health of the UK.Bank of England Governor, Mervyn King, adjusted down the growth estimates made in May of 1.5 per cent growth this year and 3.4 per cent in 2011.
He stressed that the Bank is committed to steering a steady recovery and avoiding dramatic measures or effects. He suggested it would be many years before the balance sheet would return to normal and recovery is likely to continue but weaker than was previously thought. He refused to be drawn on how much this was due to measures introduced by the new Government.
Looking to 2011 he suggested that inflation would remain above 2% and growth would remain around 2.5%.
He explained how the damage to High Street Banks had been felt mostly, but not exclusively, by small businesses which couldn’t justify borrowing at the new higher rates that Banks were forced to charge.
In parallel, new figures from the Office of National Statistics showed employment saw its largest rise for more than 21 years as the jobless total fell 49,000 in the three months to June. Unemployment fell to 2.46million after the biggest quarterly decrease for three years. The drop came after a 184,000 hike in the number of employed to 29million, marking the largest quarterly rise since May 1989.
APA
No comments:
Post a Comment