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The UK economy is on course for a “V-shaped” recovery after a faster-than-expected rebound from the lockdown slump, according to the Bank of England.
Andy Haldane, the Bank’s chief economist, said early evidence suggested Britain was benefitting from a surge in consumer spending after coronavirus restrictions were eased.
He said that if the rebound continued on the same path then the loss in annual GDP might be far lower than first feared, at 8 per cent compared to the 17 per cent forecast last month.
However, he warned that “considerable” risks remain, including mass unemployment once the government’s furlough scheme ends in October.
In a webinar speech on Tuesday, Mr Haldane said: ”Although these risks are in my view slightly more evenly balanced than in May, they remain skewed to the downside.
“Of these risks, the most important to avoid is a repeat of the high and long-duration unemployment rates of the 1980s, especially among young people.”
1/13 Flybe collapses
Airline Flybe has collapsed. All future flights on the Exeter-based airline have been cancelled – leaving more than 2,300 staff facing an uncertain future, and wrecking the travel plans of hundreds of thousands of passengers.
The chief executive, Mark Anderson, said: “Europe’s largest independent regional airline has been unable to overcome significant funding challenges to its business.
AFP via Getty
2/13 Future product placement will be ‘tailored to individual viewers’
Marketing executives say that product placement in films and televison shows on streaming services such as Netflix may be tailored to individuals in future. For instance, if data shows that a viewer is a fan of pepsi, a billboard in the background of a shot would host an advert for pepsi, while for a viewer known to have different tastes it could be for Coca-Cola
Paramount
3/13 Corbyn wishes Amazon a happy birthday
In a card sent to Amazon CEO Jeff Bezos on the company’s 25th birthday, Labour leader Jeremy Corbyn writes: “You owe the British people millions in taxes that pay for the public services that we all rely on. Please pay your fair share”
4/13 No deal, no tariffs
The government has announced that it would slash almost all tariffs in the event of a no-deal Brexit. Notable exceptions include cars and meat, which will see tariffs in place to protect British farmers
Getty
5/13 Fingerprint payment
NatWest is trialling a new bank card that will allow people to touch their hand to the card when paying rather than typing in a PIN number. The card will work by recognising the user’s fingerprint
NatWest/PA Wire
6/13 Mahabis bust
High-end slipper retailer Mahabis has gone into administration. 2 Jan 2019
Mahabis
7/13 Costa Cola
Coca-Cola has paid £3.9bn for Costa Coffee. A cafe chain is a new venture for the global soft drinks giant
PA
8/13 RIP Payday Loans
A funeral procession for payday loans was held in London on September 2. The future of pay day lenders is in doubt after Wonga, Britain’s biggest, went into administration on August 30
PA
9/13 Musk irks investors and directors
Elon Musk has concluded that Tesla will remain public. Investors and company directors were angry at Musk for tweeting unexpectedly that he was considering taking Tesla private and share prices had taken a tumble in the following weeks
Getty
10/13 Jaguar warning
Iconic British car maker Jaguar Land Rover warned on July 5, 2018 that a “bad” Brexit deal could jeopardise planned investment of more than $100 billion, upping corporate pressure as the government heads into crucial talks
AFP/Getty
11/13 Spotif-IPO
Spotify traded publically for the first time on the New York Stock Exchange on Tuesday. However, the company isn’t issuing shares, but rather, shares held by Spotify’s private investors will be sold
AFP/Getty
12/13 French blue passports
The deadline to award a contract to make blue British passports after Brexit has been extended by two weeks following a request by bidder De La Rue. The move comes after anger at the announcement British passports would be produced by Franco-Dutch firm Gemalto when De La Rue’s contract ends in July.
The British firm said Gemalto was chosen only because it undercut the competition, but the UK company also admitted that it was not the cheapest choice in the tendering process.
13/13 Beast from the east economic impact
The Beast from the East wiped £4m off of Flybe’s revenues due to flight cancellations, airport closures and delays, according to the budget airline’s estimates. Flybe said it cancelled 994 flights in the three months to 31 March, compared to 372 in the same period last year.
1/13 Flybe collapses
Airline Flybe has collapsed. All future flights on the Exeter-based airline have been cancelled – leaving more than 2,300 staff facing an uncertain future, and wrecking the travel plans of hundreds of thousands of passengers.
The chief executive, Mark Anderson, said: “Europe’s largest independent regional airline has been unable to overcome significant funding challenges to its business.
AFP via Getty
2/13 Future product placement will be ‘tailored to individual viewers’
Marketing executives say that product placement in films and televison shows on streaming services such as Netflix may be tailored to individuals in future. For instance, if data shows that a viewer is a fan of pepsi, a billboard in the background of a shot would host an advert for pepsi, while for a viewer known to have different tastes it could be for Coca-Cola
Paramount
3/13 Corbyn wishes Amazon a happy birthday
In a card sent to Amazon CEO Jeff Bezos on the company’s 25th birthday, Labour leader Jeremy Corbyn writes: “You owe the British people millions in taxes that pay for the public services that we all rely on. Please pay your fair share”
4/13 No deal, no tariffs
The government has announced that it would slash almost all tariffs in the event of a no-deal Brexit. Notable exceptions include cars and meat, which will see tariffs in place to protect British farmers
Getty
5/13 Fingerprint payment
NatWest is trialling a new bank card that will allow people to touch their hand to the card when paying rather than typing in a PIN number. The card will work by recognising the user’s fingerprint
NatWest/PA Wire
6/13 Mahabis bust
High-end slipper retailer Mahabis has gone into administration. 2 Jan 2019
Mahabis
7/13 Costa Cola
Coca-Cola has paid £3.9bn for Costa Coffee. A cafe chain is a new venture for the global soft drinks giant
PA
8/13 RIP Payday Loans
A funeral procession for payday loans was held in London on September 2. The future of pay day lenders is in doubt after Wonga, Britain’s biggest, went into administration on August 30
PA
9/13 Musk irks investors and directors
Elon Musk has concluded that Tesla will remain public. Investors and company directors were angry at Musk for tweeting unexpectedly that he was considering taking Tesla private and share prices had taken a tumble in the following weeks
Getty
10/13 Jaguar warning
Iconic British car maker Jaguar Land Rover warned on July 5, 2018 that a “bad” Brexit deal could jeopardise planned investment of more than $100 billion, upping corporate pressure as the government heads into crucial talks
AFP/Getty
11/13 Spotif-IPO
Spotify traded publically for the first time on the New York Stock Exchange on Tuesday. However, the company isn’t issuing shares, but rather, shares held by Spotify’s private investors will be sold
AFP/Getty
12/13 French blue passports
The deadline to award a contract to make blue British passports after Brexit has been extended by two weeks following a request by bidder De La Rue. The move comes after anger at the announcement British passports would be produced by Franco-Dutch firm Gemalto when De La Rue’s contract ends in July.
The British firm said Gemalto was chosen only because it undercut the competition, but the UK company also admitted that it was not the cheapest choice in the tendering process.
13/13 Beast from the east economic impact
The Beast from the East wiped £4m off of Flybe’s revenues due to flight cancellations, airport closures and delays, according to the budget airline’s estimates. Flybe said it cancelled 994 flights in the three months to 31 March, compared to 372 in the same period last year.
His comments come after the Bank’s governor, Andrew Bailey, warned against getting “carried away” by signs the recession may not have been quite as steep as it expected.
Mr Haldane said “the recovery in both the UK and global economies has come somewhat sooner, and has been materially faster” than the Bank’s Monetary Policy Committee predicted in May.
He added: “It is early days, but my reading of the evidence is so far, so V.”
Official figures released on Tuesday showed the economy shrank by more than first thought between January and March, down 2.2 per cent – the largest fall since 1979.
But Mr Haldane described the record 20.4 per cent contraction in UK GDP in April as “ancient history”, given the recovery of the UK and global economy.
The Bank’s chief economist was the only one on the nine-strong Monetary Policy Committee to vote against increasing quantitative easing at the June meeting.
Additional reporting by Press Association
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