The Bank of England’s chief economist had admitted that the UK faces two “bleak” years as it grapples with inflation and economic adjustments, according to the Telegraph.
The comments from Spencer Dale come just hours after the UK reported an increase in consumer confidence, the outlier in a string of data points suggesting economic weakness in the country.
“I understand the pain that many households are feeling and have huge sympathy for them. I think we have relatively hard times ahead,” Dale said.
The UK is currently undergoing an economic rebalancing, shifting from being a consumption based economy to one built in a strong export sector. It is simultaneously cutting government spending in a far-reaching austerity program. And while interest rates have been low to accommodate these changes, it has contributed to an environment of high inflation. Dale now was a rate hike should be expected soon.