| Have Passed Midpoint Of UK Recession |
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The U.K. has passed the midpoint of its economic recession, although the outlook for the jobs market remains "terrible," a member of the Bank of England's Monetary Policy Committee said Thursday. Speaking to the BBC, U.S.-based economist David Blanchflower said there are "some slight signs of green shoots" in the economy. "We are three quarters of the way into a very harsh recession," he said. Blanchflower steps down at the end of this month, and voted in his last rate-setting meeting earlier this week. During his three-year term, the labor economist was the most dovish member on the committee, and was the first to anticipate the severity of the recession. For five months in mid-2008, he was the only one of the MPC's nine members to vote for cuts in interest rates. Blanchflower said he expects the number of Britons without jobs to rise by 100,000 a month until the end of the year, with more than a million jobs at risk as a result of the recession. "The labor market looks pretty terrible," he said. Between October and March, the BOE cut its key interest rate to 0.5% from 5%. In March, it embarked on a program of bond purchases using freshly created money, which is known as quantitative easing. At its May meeting, the MPC voted unanimously to increase the size of the program to GBP125 billion from GBP75 billion and extend it by three months. Blanchflower said that he would have liked the central bank to have embarked on quantitative easing sooner, but that the MPC is now doing the right thing. "We're doing quantitative easing as quickly as the bank can do it," he said. |
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