Bank of England under fire over its handling of economy as inflation spirals out of management and progress slows
The Bank of England has come under fire over its handling of the economy as inflation spirals out of management and progress slows.
With the central financial institution’s financial coverage committee set to boost charges for the fifth time in six months on Thursday – to 1.25 per cent and even 1.5 per cent under some forecasts – critics accused it of speaking down the economy with its doom-laden warnings.
Dr Savvas Savouri, chief economist at Toscafund, accused the Bank of ‘hyperbolic and completely unjustified discuss of recession, certainly stagflation’.
Under strain: The Bank of England’s financial coverage committee, led by Governor Andrew Bailey (pictured), is weighing up one other fee rise from the present 1 per cent
And he mentioned the pound has weakened ‘in response to the Bank’s ludicrous prediction of recession’ – pushing up inflation by making imports costlier.
Simon French, chief economist at Panmure Gordon, additionally rounded on the Bank for its gloomy forecasts final month. ‘They set the financial scene with their communications, and actual financial outcomes movement from their forecasts,’ he mentioned.
The feedback got here because the Bank’s nine-strong committee, led by Governor Andrew Bailey, weigh up one other fee rise from the present 1 per cent.
An enhance would push up borrowing prices for hundreds of thousands of households and companies.
The Bank is under strain to behave amid warnings inflation will high 10 per cent this yr, having already hit a 40-year excessive of 9 per cent.
But it’s feared that elevating charges too far too quick will additional derail the already fragile financial restoration from the pandemic and tip Britain into recession.