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UK Economics

Mark Carney has lost his nerve but the UK economy is now in far better shape

THE decision to cut rates and unleash massive stimulus smacked of panic and will do little to help the UK thrive.

Mark CarneyGETTY

Mark Carney lost his nerve


Bank governor Mark Carney should be working to boost our resolve and help build an exciting future outside the EU, but he has lost his nerve.

Mr Carney – a key figure in Remain’s Project Fear – is also taking revenge on Britons who ignored his scare-mongering and bravely voted to take back control of their country.

The monetary policy committee cut rates to 0.25 per cent and members indicated they are ready to cut again – dragging base rates to near zero.

Savers thought they suffered enough after seven-and-a-half years of record low rates.

But annuity rates have also plunged and savers’ plight will worsen if forecasts are correct and inflation goes to 2.4 per cent over the next two years.

The pound fell again yesterday, making foreign holidays more expensive and pushing up the cost of imported goods, although at least it should help exporters.

Bank of EnglandGETTY

Outside the Bank of England


But cutting rates will have little impact as most Britons are now reluctant to take on more debt or chase house prices.

Naturally, Mr Carney will shift blame for his failings on Brexit, brushing over the fact bankers around the world have already made 55 rate cuts in 2016.

The global economy is slowing and would have continued to do so, and that is nothing to do with the EU referendum.

Mr Carney will shift blame for his failings on Brexit

In fact, signs are that after its initial Brexit wobble, the UK is quickly starting to fight back.

Stock markets have been rising, house prices hold steady, and although business and construction activity has dipped, this may largely be a reaction to initial uncertainty.

The Bank may be in a flap but the rest of us should keep calm.

Bank of EnglandGETTY

The economy is actually in good shape


Bank of EnglandGETTY

The Bank of England cut interest rates


The UK economy is in far better shape than yesterday’s rash actions suggest, with the IMF recently predicting it will grow faster than France and Germany.

It may do better still when the benefits of Brexit finally start flowing, provided it can cope with panic at the top.

http://www.express.co.uk/comment/expresscomment/696967/Mark-Carney-lost-nerve-UK-economy-better-shape-finance-banking-markets-comment

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