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Departing King's ray of hope for UK economy

Wednesday, May 15, 2013 - 01:41

May 15 - Britain's central bank lifts a bit of the gloom hanging over the economy by issuing a slightly improved outlook for inflation and growth for the first time since the financial crisis. Rough Cut (no reporter narration).

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(ROUGH CUT -- NO REPORTER NARRATION) Bank of England Governor Mervyn King, presiding over his final Quarterly Inflation Report before he hands the reins to Mark Carney, said the better forecasts did not mean the recovery was secure. Annual inflation, currently running at 2.8 percent, is likely to fall back to around the bank's 2.0 percent target in two years' time. That was lower than a forecast of 2.3 percent the Bank of England issued in February. Sterling rose 0.3 percent against the dollar to hit $1.5272 after the forecasts but was later was flat on the day. British government bond prices extended their losses. Britain has been suffering its slowest economic recovery in decades, and the BoE forecast that GDP was more likely to remain below its pre-crisis level for another year or so. Unemployment data on Wednesday underscored how weak Britain's economy remains, with a broad international measure of joblessness rising and earnings excluding bonuses growing at their slowest pace since records began in 2001. King has presented the BoE's inflation report for more than 20 years. After he was given a farewell round of applause by reporters, he said he would miss the quarterly news conferences.

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Departing King's ray of hope for UK economy

Wednesday, May 15, 2013 - 01:41