Britain's economy is recovering from the pandemic worse than the EU or the United States, the Bank of England governor has said. Andrew Bailey says there was a 'dramatic' and 'stark' difference in Covid-19 recovery.
Speaking at the Treasury Select Committee on Wednesday, he told MPs of the difference in economic fortunes. The governor said the UK's GDP had not yet recovered to its pre-pandemic level.
In fact, he said it was 0.7% smaller than it was. In contrast, the Eurozone's economy was 2.1% bigger than it was.
Meanwhile the United States now has a GDP 4.2% larger than it did in 2019. Economic activity all but stopped across the world during the height of the pandemic in 2020.
In most cases, a reopening caused a sharp bounce back, reports The Independent. But it seems the UK has not had such good fortune when compared to its neighbours.
"I'm afraid it's not a good story I'm about to tell you: the level of UK GDP now versus the pre Covid level, compared to other economies is think -0.7 per cent," Mr Bailey told MPs. "So in other words, the economy is smaller than it was at the end of 2019 in terms of GDP. The euro area is plus 2.1 and the US on the latest number, which is just come out, is plus 4.2.
"It is a dramatic difference. I think there's probably quite a few things account for it: the approach that's been taken towards energy prices, fiscal support, the US has had a lot of fiscal support and is in a very different position in terms of the economy. So there's probably quite a lot of things contributing to it, but it's pretty striking."
Mr Bailey was addressing MPs on the same day the Office for National Statistics showed soaring food and energy prices had driven UK inflation to a 40-year high of 11.1 per cent.
