BoE hints at more economic damage


Sterling drifted lower yesterday against the greenback after Bank of England policymakers warned that Britain’s economy could suffer more damage than first anticipated and that a recovery could be far slower than what some had estimated.

Previously the BoE had expected the economy to recover to its pre-covid size by the end of next year, but deputy Governor Dave Ramsden yesterday stated the economic output would be permanently 1.5% lower than it would have been without the pandemic. Policymaker Gertjan Vleighe also warned of the real risk that it could take several years for Britain’s economy to return to its full capacity.

Key announcements

10:00 – EUR – Retail Sales (YoY) (Jul); expected to rise to 3.5% from previous 1.3%
15:00 – GBP – BOE Governor Bailey Speech

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