Half lost output clawed back
UK in a V-shaped recovery, claims Bank economist
Andy Haldane says UK is on the road to recovery
Bank of England chief economist, Andy Haldane, says Britain is enjoying a V-shaped recovery, claiming that the economy has recovered half of the output lost in the lockdown.
In the face of devastating data on GDP and unemployment, Mr Haldane insists the UK is in the middle of a quick turnaround.
He told MPs that the economy had been growing on average at about 1% a week since May and the bounce-back in activity extended other parts of the UK outside London and the south-east.
He said: “Roughly half of the roughly 25% fall in activity during March and April has been clawed back over the period since.
“We have seen a bounce-back. So far, it has been a V. That, of course, doesn’t tell us about where we might go next.”
Mr Haldane was speaking at a hearing to reconfirm him as a member of the Bank’s Monetary Policy Committee (MPC).
He was the only member of the Bank’s nine-strong Monetary Policy Committee who last month voted against an expansion of quantitative easing – expanding the asset purchase programme aimed at boosting the economy.
However, fellow MPC member Silvana Tenreyro, told the Treasury Select Committee that the economy was struggling to grow and would stumble over the course of the next few months as consumers maintained physical distancing.
Speaking to members, Ms Tenreyro, a London School of Economics academic said: “Spending is going to suffer because of the perceived health risks and this will feed into higher unemployment and lower incomes.”