Bank of England says UK faces ‘slow motion slowdown’

By Natalie Holt

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Mar 29, 2017
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Bank of England policymaker Ian McCafferty says UK economic growth is more likely to be a “slow motion slowdown” rather than a return to a sharp recession.

McCafferty sits on the Bank’s monetary policy committee and has voted to raise interest rates 11 times since 2012.

Speaking on LBC radio, McCafferty says any economic slowdown would likely to be “slow motion, so that growth becomes anaemic rather than anything like a sharp recession at this stage.”

The Telegraph reports McCafferty admitted the Bank got it “wrong” in the wake of the Brexit vote, with overly gloomy economic forecasts.

But he warned the impact of stalled negotiations as the UK prepares to leave the EU would hit the economy hard.

He said: “I’d be very surprised if we could find no deal that was worse than a deal, there is so much of our national life … that is linked to EU bodies as well as EU law.

“We could transfer laws back, but we would have to set up quite a number of civil service bodies. And [if we had] to do that in a rush because if it became apparent that no deal was available or both sides had walked out in a huff, then we would find quite a lot of disruption to the UK economy which would probably put us into a period of probably a couple of years in which the economy would perform really quite badly.”

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