IMF Article IV initial health check of the UK economy about to report back. We will hear from Chancellor @rishisunak, and IMF chief @kgeorgieva very shortly...
IMF cuts UK economic forecast from last month for this year and next
2020 - -10.4%
2021 +5.7%
But praises “aggressive policy response - one of the best examples of coordinated action globally” on the economy...
2020 - -10.4%
2021 +5.7%
But praises “aggressive policy response - one of the best examples of coordinated action globally” on the economy...
IMF: “Room to loosen monetary policy in the near term”
Backs “additional fiscal push”... “there is a case to spend more” than current plans to lift investment...
UK economy “now faces headwinds from a second Covid-19 wave, Brexit related uncertainty, rising unemployment..”
Backs “additional fiscal push”... “there is a case to spend more” than current plans to lift investment...
UK economy “now faces headwinds from a second Covid-19 wave, Brexit related uncertainty, rising unemployment..”
IMF: “we encourage the UK and EU authorities to make every effort to reach a post- Brexit trade agreement and finalize preparations for implementation. Progress on a range of issues has been made over the past year and there is room for a compromise beneficial to both sides”
IMF on Brexit talks: “A solution would remove important downside risks to the outlook. In the absence of an agreement, a stronger policy response would be needed to address a deteriorated outlook” - ie bigger fiscal and monetary response...
Chancellor making the case that the existing Spring budget investment plans are an existing fiscal stimulus - which seems to be a response to the idea from IMF that there could be a bigger stimulus
IMF CHief @Kgeorgieva: Pandemic “has already taken an enormous human toll and caused unprecedented economic disruption, including in the UK, and unfortunately, we are seeing a second wave take hold in Europe.”
... IMF chief: UK econ response: “one of the best examples of coordinated action that we have seen globally. We welcome the continuing efforts the government has made to refine its support measures, including adaptations to the Jobs Support Scheme announced last week.”
IMF’s Georgieva says “continued policy support is essential to address pandemic”.. policy space exists...
- keep special job and company support programs in place
- support “additional fiscal push” on public investment
- BoE scaling up bond purchases. negative rates an option
- keep special job and company support programs in place
- support “additional fiscal push” on public investment
- BoE scaling up bond purchases. negative rates an option
Georgieva also praises UK leadership in Globe, including on vaccines and on debt relief for low income countries...
IMF’s Georgieva makes clear that the downgrade to forecast for UK this year and next (from earlier this month) is because second pandemic wave risks “have materialised”. Stresses that the hit wont be the same as in first wave
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