08.08.12
Growth of 0% expected in BoE report
The Bank of England is expected to forecast 0% growth in its quarterly inflation report, which will be published today. This compares to predictions of 0.8% three months ago and 2% a year ago.
The predictions could put further pressure on chancellor George Osborne to soften austerity measures.
The UK economy contracted by a greater-than-expected 0.7% between April and June, meaning the double-dip recession is the longest since the 1950s, after the additional bank holiday for the Queen's diamond jubilee hit output.
Howard Archer, chief UK and European economist at IHS Global Insight, said the Bank of England will “likely acknowledge that the economy has taken a significant turn for the worse and currently faces a worrying and uncertain outlook”.
The BoE and the Treasury recently launched a new scheme to increase lending to households and companies. The Funding for Lending initiative is initially expected to lend about £80bn at below-market rates to banks and building societies.
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