BoE Governor sees signs of economic recovery

Andrew Bailey gives view on the state of the British economy

Bank                                 

The Governor of the Bank of England Andrew Bailey has stated that the British economy has begun to recover from the devastation wrought by the Covid-19 lockdowns but admitted that pressures and uncertainty still loom large.

In a webinar organised by the United Kingdom’s central bank, Bailey observed: “We are seeing activity return. We are beginning to see this recovery.” In particular, the governor pointed to the housing and car markets, where activity was resuming “quite strongly.”

The recent apointee did admit that the hospitality and entertainment industries have continued to struggle despite the easing of some lockdown measures.

Earlier this week, the UK economy was revealed to have grown by just 1.8 per cent in May, far below the 5.5 per cent widely anticipated by economists. This dented hopes that the long-discussed V-shaped recovery will soon materialise.

Indeed, there are growing fears that the lockdown measures mandated by Boris Johnson to protect lives will fundamentally alter Britons’ way of life even after the pandemic has ended.

During the online discussion, Governor Bailey stated that there is a “very big question” regarding the extent to which people will be willing to return to life as it was before the crisis and the threat of a second coronavirus wave to the fledgling recovery.

When asked for his views on the threat of company failures on the wider economy in the context of BoE Chief Economist Andy Haldane’s recent bullishness, Bailey observed: “We don’t yet know the full story of this.”

At the close of Friday trading, the FTSE 100 Index closed up 0.63 per cent at 6,290.30, practically unchanged from its position a month ago.

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