6 Aug 2020

Bank of England governor: Coronavirus is ‘bigger immediate shock to the economy’

The relaxation of the planning rules is meant to give the economy a boost – and it certainly needs it if the Bank of England is correct.

Today, it said output was bouncing back faster than hoped.  But it warned the recovery may take longer.

The Bank’s latest forecasts show economic output shrinking by 21 per cent in the second quarter of this year.

Amazingly, that record collapse is an improvement on the 25 percent drop they had been expecting.

But the Bank expects that in three years time, the economy will still be smaller than it would have been if Covid never happened.

We spoke to the governor of the Bank of England, Andrew Bailey, and asked if his main message today was that the impact of the lockdown may be less acute but more long lasting.