Wednesday, November 12, 2008
Bank goes for bust
Posted by David Smith at 03:30 PM
Category: Thoughts and responses

The Bank of England attracted some well-aimed criticism this morning for its inflation report predictions, which now rank among the gloomiest among economists, having been among the most optimistic. The Bank has had what appears to be the opposite of a Damascene conversion over the past three months to the seriousness of the credit crisis, and now thinks the economy is heading for a big recession, albeit a short, sharp one, and that the inflation problem will be one of undershooting - even deflation - not overshooting. A fascinating inflation report, available here, where you can also watch the webcast of the press conference.

Also today, unemployment figures showed a 36,500 rise in the claimant count last month and a 140,000 rise in the Labour Force Survey measure of unemployment over the July-September period. Bad, though not quite as bad as feared. Details here.