BoE Deputy Governor Ben Broadbent said in the TSC hearing that “it remains the case, on our central forecast, that UK economy doesn’t return to its pre-pandemic size until early 2022, after the same point for both the US and the Euro area.”
Also, “as the furlough scheme is assumed to close at the end of April while restrictions still exist, “the recovery in demand is expected to be insufficient to prevent a material rise in unemployment”.
BoE’s monetary easing “already anticipates a significant rise in unemployment and spare capacity through the spring and summer of this year.” Still, “there are clearly significant risks around that, not least from the relative timings of the ending of restrictions on the one hand and the closure of the furlough scheme on the other.”
“Those risks are in both directions,” he added.
