Bank Governor Mark Carney insists the economy is on the up

0
8


Mark Carney today struck an upbeat note on the economy, insisting Britain’s slow down had been fuelled by bad winter weather not Brexit.

The Bank Governor said an upgrade to growth data for the first part of this year backed up his assessment the economy was strong.

But Mr Carney – who is due to leave his post in a year – said an escalation of Donald Trump‘s trade war would damage both sides of the Atlantic.  

He said the President’s protectionist rhetoric is currently just ‘talk and tweets’ but said there are already signs that the global economy is taking a hit.  

Mark Carney (pictured today in Newcastle) struck an upbeat note on the economy, insisting Britain's slow down had been fuelled by bad winter weather not Brexit

Mark Carney (pictured today in Newcastle) struck an upbeat note on the economy, insisting Britain’s slow down had been fuelled by bad winter weather not Brexit

The Bank Governor said an upgrade to growth data for the first part of this year backed up his assessment the economy was strong

The Bank Governor said an upgrade to growth data for the first part of this year backed up his assessment the economy was strong

The Bank Governor said an upgrade to growth data for the first part of this year backed up his assessment the economy was strong

The governor was speaking at the Northern Powerhouse Business Summit in Newcastle today.

He said the final reading of economic growth for the first quarter, which was revised up from 0.1 per cent to 0.2 per cent last week, confirmed his view of the UK’s trajectory. 

He said: ‘Domestically, the incoming data have given me greater confidence that the softness of UK activity in the first quarter was largely due to the weather, not the economic climate.

‘A number of indicators of household spending and sentiment have bounced back strongly from what increasingly appears to have been erratic weakness in Q1.’ 

Mr Carney said that while the Bank of England has been able to prop up the economy in the wake of the Brexit vote, conditions would not be as favourable in an all-out trade war.

He said the final reading of economic growth for the first quarter (pictured far right), which was revised up from 0.1 per cent to 0.2 per cent last week, confirmed his view of the UK's  positive trajectory

He said the final reading of economic growth for the first quarter (pictured far right), which was revised up from 0.1 per cent to 0.2 per cent last week, confirmed his view of the UK's  positive trajectory

He said the final reading of economic growth for the first quarter (pictured far right), which was revised up from 0.1 per cent to 0.2 per cent last week, confirmed his view of the UK’s  positive trajectory

Outlining the success of the Bank’s Brexit contingency measures, he said: ‘By the first quarter of this year, UK GDP had increased by 1 percentage point less than the MPC had projected just prior to the referendum.

‘This is despite the fact that Brexit has not happened yet and that UK financial conditions have remained supportive since the referendum, in contrast to previous periods of elevated uncertainty.

‘This in part reflects the package of easing measures implemented by the MPC in August 2016 and less stringent fiscal policy as well as the resilient global environment.’

But turning directly to President Trump’s actions, Mr Carney added: ‘In a general trade war, it is unlikely that global financial conditions would prove as robust, or that monetary policy could be as supportive.’ 

Economic models by the Bank of England show that a 10 percentage point rise in tariffs between the US and all of its trading partners could knock 2.5 per cent off US output and 1 per cent off global output.

‘The hit to global and UK GDP (gross domestic product) would be substantially greater if everyone put up tariffs against everyone else,’ the governor warned.

But Mr Carney - who is due to leave his post in a year - said an escalation of Donald Trump's trade war would damage both sides of the Atlantic (the President is pictured in West Virginia on Wednesday) 

But Mr Carney - who is due to leave his post in a year - said an escalation of Donald Trump's trade war would damage both sides of the Atlantic (the President is pictured in West Virginia on Wednesday) 

But Mr Carney – who is due to leave his post in a year – said an escalation of Donald Trump’s trade war would damage both sides of the Atlantic (the President is pictured in West Virginia on Wednesday) 





Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here