Bank of England Bailey sees British economy start to recover

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Bank of England Governor Andrew Bailey poses for a photo on the first day of his new role at the Central Bank in London, Britain, March 16, 2020. Tolga Akmen / Pool via REUTERS

LONDON (Reuters) – Bank of England Governor Andrew Bailey said on Friday that the UK economy was starting to recover from the shutdown of its coronavirus, but some job-intensive sectors remained weak and prospects in the long run were unclear.

“We are seeing the return of activity. We are starting to see this recovery, ”said Bailey at a central bank webinar.

There have been signs of activity returning “fairly strongly” in the housing market and in new car sales, but not in the hotel and entertainment industry, which employ large numbers of people, many of them low-paid , did he declare.

There was a “very big question” on how people would be cautious about returning to life as before the crisis and there were also risks of a second wave of COVID-19, or localized epidemics, said Bailey.

In addition, the BoE did not know how much long-term damage the economy would suffer as a result of corporate bankruptcy.

“We don’t know the whole story yet,” he said in response to a question about whether he shared the opinion of BoE chief economist Andy Haldane , according to which the economy would recover quickly in the form of a V.

Earlier this week, UK budget forecasters said the economy could shrink by more than 14% this year if there were lasting damage from the coronavirus.

Writing by William Schomberg; Editing by Edmund Blair and Catherine Evans

Our standards:Principles of the Thomson Reuters Trust.

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