Bank chief 'hopeful' over economy
Updated on 13 July 2009
Bank of England deputy governor Charlie Bean has said he is "reasonably hopeful" the UK economy would see growth return next year.
In an interview at the start of a seven-day tour of the UK to explain the Bank's quantitative easing (QE) programme, Mr Bean said: "I would certainly hope that by the time we are into next year it would look as if things are on the mend and obviously our monetary policy measures - quantitative easing and lower bank rate - are designed to try to speed that return to a normal set of business conditions."
The deputy governor for monetary policy added that the impact of its QE efforts to buy bonds and assets to boost money supply and ease recession would take time to emerge.
He also dismissed rumours that the QE programme was about to close, after speculation mounted in the wake of last week's decision by the Bank to hold rates and opt for no further action on the asset purchase scheme.
The Bank had been expected to expand its quantitative easing (QE) programme - effectively printing money - by £25 billion to £150 billion.
"One shouldn't expect to see the effects of this on the economy now. It's more about sustained demand, money spending in the economy over the next six months to a year," said Mr Bean.
His comments on growth in 2010 offer a more optimistic note after recent concerns that recovery hopes were overdone.
Nerves were tested after manufacturing output showed a surprise fall in May, and official figures showed a far worse than expected 2.4% slump in overall GDP in the first three months of 2009 - the biggest quarterly fall in more than 50 years.
All eyes are now expected to be on GDP results for the second quarter, which are due out from the Office for National Statistics next week.
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