LONDON (Reuters) - Britain looks set for a “significant slowdown” but is likely to avoid recession, according to Bank of England Monetary Policy Committee member Andrew Sentance.
Speaking to Warwick University’s student radio station earlier this week he said it was hard to know how hard the credit crunch would hit the real economy.
“You can’t totally rule that (a recession) out, because we are vulnerable to shocks from the external economy, and we are dealing with some things, pressures from the financial markets, that are very difficult to calibrate and to understand at the moment,” Sentance said.
“So our best assessment is that the forecast is not for recession, but what we do expect to see is quite a significant slowdown in growth, and in some sectors of the economy that will be felt more significantly than others.”
Sentance said it was important that the public trusted the central bank would act to keep inflation under control.
“The important thing is that there is confidence that inflation will come back to target,” he said.