Has there just been another "Recession that never happened?"

In respect of my post here, the Independent newspaper reports that, and I quote,

Ben Broadbent, the deputy governor of the Bank of England, said the recession talk over the past few days has been 'unhelpful.' He suggested there was the possibility that upward revisions in the future may mean that a recession never actually took place."

It is not difficult to see that Ben Broadbent is correct. Based on the initial and provisional figures released last week, the Office for National Statistics said economic activity declined by 0.3% in the fourth quarter of the year from the previous three-month period. That followed the previous quarter's 0.1% fall, which meant that the British economy is considered to be in recession.

However, such provisional figures tend to be revised upwards by an average of 0.15 percentage points. If that happens this time, and if the present quarter returns to growth - which looks very possible as the Bank of England governor Andrew Bailey said yesterday that a recovery upturn is probably already underway - then this will indeed be another recession that never was.

However, I want to see much stronger growth than we saw in 2023. The PM was right to see that we needed to get inflation under control and halve it from the level where it was when he took office: now we need to achieve his second priority, get the economy growing again properly.

And that means I will absolutely not be happy marginal growth just above zero, I want to see the UK economy returning to the historical trend growth of a couple of percent a year.

The only way we can afford better hospitals, better schools, better public services and to pay everyone the incomes which will deliver rising living standards is if we can grow productivity and output.

To achieve that, we need to offer British businesses large and small the combination of stability, low inflation and lower taxes. And we need to recreate an environment in which there will be strong investment in British business.


Popular posts from this blog

Nick Herbert on his visit to flood hit areas of Cumbria

Quotes of the day 19th August 2020

Quote of the day 24th July 2020