The UK economic recovery is likely to be slow and uncertain despite a short term spike in inflation, the Bank of England said today.
Tony Bonsignore, CityWire.co.uk – 11 November 2009
Despite recent stronger economic indicators, the economy was still facing significant headwinds, the BoE said in its key quarterly Inflation Report.
‘The strength of the recovery remains highly uncertain and depends on the opposing forces affecting the outlook,’ the report said.
‘The Bank’s asset purchases have injected money into the economy, raising the prices of a range of assets and improving companies’ access to capital markets. Nevertheless, spending growth remains weak.’
It was likely to take a ‘considerable period’ for banks to repair their balance sheets, the report said, though the impact this would have on the broader economy would depend on the extent to which households and businesses could access alternative sources of finance.
Bank of England Inflation Report Q3 2009
