Bank of England warns UK economy will flatline over the coming year as it ... trends now
21 shares
150
View
comments
The Bank of England gave a grim assessment that the economy is set to flatline today as it spared Brits fresh mortgage pain by keeping interest rates on hold.
Threadneedle Street cut growth forecasts as it announced that the base rate is being maintained at 5.25 per cent - but warned there is no prospect of cuts soon.
Although the move by the Monetary Policy Committee is a relief for homeowners, markets will be alarmed by the darkening mood about the prospects for UK plc.
The Bank see growth tumbling to zero in the second quarter of next year and staying there until the second quarter of 2025.
It is a bleak backdrop for Chancellor Jeremy Hunt, who is due to deliver his crucial Autumn Statement within weeks.
Governor Andrew Bailey said higher interest rates are 'working and inflation is falling', but pointed out that prices are still rising well above the 2 per cent target.
'We've held rates unchanged this month, but we'll be watching closely to see if further rate increases are needed. It's much too early to be thinking about rate cuts,' he said.
The forecast is based on
