The Bank of England raised its 2021 GDP growth forecast to 7.25%. This would be the strongest increase since the official registration in 1949.
Bank of England analysts point out that such optimistic forecasts are linked to the huge success of the national vaccination program, and thus – the reopening of trade and services.
Today’s press release said: “The UK’s GDP is expected to decline by around 1.5% in the first quarter of 2021 – less than expected in the February report.”
“While activity in the second quarter is likely to remain on average about 5% below its level in the fourth quarter of 2019, GDP is expected to return to pre-Covid-19 levels for the remainder of this year,” he added. The bank expects the rate of GDP growth to slow after 2021.
Bank of England analysts have also revised their forecasts on the number of unemployed. Later this year, the unemployment rate is expected to peak at 5.5%, up from 7.75%. Expected in January this year.
“Most of the workers will return to work when the economy returns to work,” the press release said.
The Bank of England also kept the key rate at a record low of 0.1%.
BBC / Agata C.
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