The Governor of the Bank of England (BoE), Andrew Bailey, speaking on BBC Radio 4 this Monday, has said that the effect of the restrictions due to COVID-19 on the economy is enormous but appears to be decreasing.
Key Comments:
Now I am more positive, but with a great deal of caution, about recovery.
The economy is expected to return to pre-pandemic size later this year.
We now have a more balanced picture of risks.
The accumulation of savings is an upside risk.
I think there could be an expense of the savings.
A very useful permit program that will extend beyond the end of the restrictions of COVID.
I hope the next Bank of England forecasts show a lower peak in unemployment.
I would expect inflation to pick up to 2% in the coming months.
The question is whether the rebound in inflation will continue.
We will need to see evidence that the inflation trend is sustainable.
We do not see inflation rise to 4-5%.
We have not run out of tools for monetary policy.
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