Further confirmation (if any was needed) of the worsening of the UK's economic position. The governor of the Bank of England, Mervyn King, has warned that the UK is "in a deep recession" in 2009 and said rate cuts may no longer work and hinted thta 'unconventional' measure may have to be used. In its latest forecast for economic growth and inflation, the Bank says that the UK economy will decline sharply in the first half of the year. And it says that there is a significant risk that the recession will be even longer and deeper than expected. The Bank forecasts the economy will shrink by 4% from mid-2008 to mid-2009. What do you think Mervyn King meant by 'unconventional' measures?
2 comments:
Maybe he meant using methods other than fiscal or monetary policies. Not sure what other methods you can use to boost consumer confidence.
i dont think anything is going to boost confidence in the Uk at the moment. Theyve cut Vat, lowered interest rates to practically nothing and it seems the only thing left to do is follow america by either giving tax rebaits or lowering income tax, something which is only going to increase government debt and have a negative effect on taxpayers in the future. Perhaps subsidising businesses to hire employees is an option but that is far too costly for the amount of people unemployed at present. Lowering corperation taxes could lower business costs and lead to lower unemployment. theres no easy solution but they got to find one! p.s i got an account jonesy! wahay!
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