The Bank of England has cut interest rates by a quarter of a point today (Thursday, February 7th) to 5.25 pct from 5.5 pct. Will it make a difference to the UK economy? Former Deputy Governor of the Bank of England,
Sir Howard Davies, forecasts that there will be either a slowdown or
recession whatever happens.
Davies is Director of the London School of Economics and has had a wide career. He even supports Manchester City hailing from the great city.
Today (Thursday) the Bank of England said inflation risks had worsened. So why did'nt the bank lift interest rates? I suppose we have got ourselves in a bit of a hole. The U.S Federal Reserve has been ignoring its inflation risks as well by cutting interest rates.
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