Whoops - BOE downgrades forecast and backs up labours concerns

Graham_Devon

The Bank of England is less optimistic about our recovery than it was in February.

It has revised in a downward direction its projections for the belated recovery in GDP, productivity (or output per hour worked) and living standards.

And what underlies not exactly pessimism but a tempering of bullishness is its new analysis that a disproportionate number of new jobs in the economy are lower skilled and less productive.

In that sense, it has reinforced Labour's concern that the revival of our economy was not doing enough to make most people richer - though, to state the obvious, a bit too late to lend credibility to Ed Miliband's campaign.

So now we have Mark Carney himself stating that the new jobs in the economy are disproportinately lower skilled and less productive.

They have cut the growth forecast from 2.9% to 2.5%.

Wage growth was also downgraded from 3.5% to 2.5%.

http://www.bbc.co.uk/news/business-32720772

IronWolf

If all the new jobs were high paid high skilled jobs we would have Labour supporters accusing the Torys of 'only creating jobs for the bankers'. They honestly can't win.

caronoel

The good news from this is that it pushes the prospect of rising interest rates even further into the future.

I cant see interest rates rising before early 2017

purch

Graham_Devon wrote: »

They have cut the growth forecast from 2.9% to 2.5%.

Wage growth was also downgraded from 3.5% to 2.5%.

And it backed expectations interest rates may rise in about a year's time.

......something doesn't compute :eek:

CLAPTON

presumably as the BoE has changed its mind since February, it will change its mind again in 3 months time

it's certainly worrying that they have only just realised that most 'new' jobs that been mainly low paid and unskilled

many of us have know that for several years and see it as an inevitable consequence of the large number of immigrants

low interest rates show a sad failure of the economy to expand aggressively.

chucknorris

caronoel wrote: »

The good news from this is that it pushes the prospect of rising interest rates even further into the future.

I cant see interest rates rising before early 2017

I seem to remember that when the base rate was first cut to 0.5%, some doomsters were saying that the economy was doomed, and like Japan, would be for decades, and that interest rates would stay low for that long (with deflation etc. etc.). Although still very unlikely, that 10 year anniversary is beginning to appear on the radar.

Thrugelmir

Whoops - BOE downgrades forecast and backs up labours concerns

The two Ed's have gone. Time to move on. New leader new approach.

wymondham

I thought the Tories winning was supposed to give the markets a boost as well .... my pension pot has fallen markedly since the election!

Thrugelmir

wymondham wrote: »

I thought the Tories winning was supposed to give the markets a boost as well .... my pension pot has fallen markedly since the election!

General sentiment is that underlying Corporate profitability does not support current share valuations.

Thrugelmir

chucknorris wrote: »

I seem to remember that when the base rate was first cut to 0.5%, some doomsters were saying that the economy was doomed, and like Japan, would be for decades, and that interest rates would stay low for that long (with deflation etc. etc.). Although still very unlikely, that 10 year anniversary is beginning to appear on the radar.

Similar problems. Similar outcomes.

HAMISH_MCTAVISH

Thrugelmir wrote: »

General sentiment is that underlying Corporate profitability does not support current share valuations.

General sentiment is that the people who have been spouting pessimism. And Haiku-like utterances of doom. Since 2005. Have been consistently wrong.

Just sayin...;)