Britain’s economy is already showing “distinct signs of an upturn” after slipping into recession at the end of last year, the Bank of England’s governor said on Tuesday.
Andrew Bailey predicted that the UK would be hit by a “very small recession”.
He also said inflation was set to fall to around two per cent in the spring but then to pick up slightly later in the year.
Appearing before the Commons Treasury committee, Mr Bailey said: “Against a lot of talk about what is we think is going to be a very small recession, we think the economy is already actually showing distinct signs of an upturn.”
The prediction by the governor will be welcome news for Jeremy Hunt ahead of his March 6 Budget.
The Chancellor has signalled that he will have limited room for tax cuts next month.
But the Government is hoping that the economy picks up in time for the next general election, expected in the autumn.
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