Bank of England’s Bailey expects ‘pronounced recovery’ for economy By Reuters

LONDON (Reuters) – Bank of England Governor Andrew Bailey said on Wednesday he expected a “pronounced recovery” in Britain’s economy as the country moves ahead with vaccinating its population against COVID-19.

“I really do think that we are going to see a pronounced recovery in the economy as the vaccination programme, as it is doing now, rolls out,” Bailey said in an online event organised by the BoE.

Britain has suffered the highest death roll in Europe from COVID-19 and its economy shrank by the most among the world’s industrial power-houses in the first half of 2020.

But Britain has so far vaccinated more people against COVID-19 than almost any other country, raising hopes of a recovery once its latest lockdown ends and the government begins to ease restrictions.

Bailey’s comments came a day after the BoE’s Chief Economist Andy Haldane said he expected Britain’s economy to begin to recover “at a rate of knots” from the second quarter of this year.

Bailey said the impact of lockdowns on Britain’s economy seemed to be diminishing, but the current one would still deliver a big blow.

The share of retail sales that had moved online rose sharply in 2020 as consumers and businesses adjusted to social distancing rules, he said.

“We’re expecting however, obviously, quite a pronounced effect in the first quarter because this lockdown is obviously again necessarily a severe one,” Bailey said in an online discussion organised by the BoE.

The central bank is due to make its next monetary policy announcement on Feb 4. A Reuters poll of economists published last week showed the BoE was expected to keep its benchmark lending rate at 0.1% until at least 2024.