Bank of England

Analysis: Economy not quite as awful as feared

Faisal Islam

BBC Economics Editor

The Bank of England has increased its support for the UK economy, despite it assessing that the outlook is not quite as awful as its scenario last month.

The economy is on course for a hit in the second quarter of around 20% compared with the final three months of 2019. That’s still historic, and off the scale, but not quite as extreme as the 27% it predicted in May.

The extra £100bn of purchases of government bonds also has the air of an insurance policy.

Still, there are concerns the recovery will not be quick due to the “prevalence of the virus” in the UK. And the bank remains wary of there being a second wave in future.