The British economy is set to plummet into its worst recession for 300 years because of the coronavirus crisis, the Bank of England warned yesterday.
In a bleak assessment, the Bank said economic output will shrink by 14 percent this year in the worst annual fall since records began. It said GDP could plunge by nearly 30 percent in the first half of the year before recovering some ground.
But the impact of the deadly disease will continue to be felt long afterwards with unemployment jumping from 4 percent to 9 percent, meaning another 1.5 million people could be out of a job.
The grim economic outlook estimated for 2020 would be the biggest recession since 1709 when the Great Frost brought fledgling economies grinding to a halt across Europe.
However, the Bank said the economic fall should be temporary and that activity is expected “pick up relatively rapidly” as lockdown is eased this month.
But it would take more than a year for the economy to recover from when the lockdown is fully lifted.
The grim forecast came as the Bank held interest rates at the historic low of 0.1 percent after recent emergency action.