Picture painted by Inflation Report too optimistic

15th May 2013

Commenting on the Bank of England's Quarterly Inflation Report, David Kern, Chief Economist at the British Chambers of Commerce (BCC) said: -While we have always felt that the earlier gloom over the UK economy has been exaggerated, the positive trends outlined within Governor King's final Inflation Report appear to be too optimistic.

We accept that growth is likely to remain positive, but believe that the speed of the recovery will be somewhat slower than the Governor indicated. The grim eurozone data also shows that our exporters will face obstacles over the year ahead. We also think that the inflation outlook is slightly worse than the report suggests, and future falls in 2013 and 2014 will not happen as quickly. -With the flexible monetary remit given to the MPC by the Chancellor, and the likelihood of policy changes after the arrival of Mark Carney as Governor, it is important that the MPC does not encourage a faster sterling devaluation to support exports - even if inflation rises temporarily. The unusually weak earnings figures highlight the squeeze on businesses and consumers, and there is a risk that the small benefits to exports will be outweighed by damage to domestic demand that can harm growth.

You might also be interested in

Removal of quarantine for double jabbed EU and US Nationals to enter England is great news - BCC

Thu 29th July 2021

Responding to the news that fully vaccinated travellers from the EU and US will not have to quarantine, British Chambers of Commerce Co-Executive Director, Claire Walker, said:

Trade stats show pandemic masking Brexit effects

Thu 29th July 2021

Responding to today's ONS trade statistics, William Bain, Head of Trade Policy at the British Chambers of Commerce, said:

BCC Calls for Negotiated Settlement Following Latest NI Protocol Announcement

Mon 26th July 2021

Responding to the announcement of the new UK approach to the Northern Ireland Protocol, William Bain, Head of Trade Policy at the BCC, said:

BCC Says Many Businesses Face Difficult Weeks Ahead Despite Plan for Self-Isolation Exemptions

Fri 23rd July 2021

Responding to an update on possible self-isolation exemptions for key workers in critical services, Hannah Essex, Co-Executive Director of the BCC, said: