According to the Bank of England (BoE) the UK economy will bounce back strongly this year due to the rapid vaccination programme. This spring will see consumer confidence return according to policymakers.
The govenor of BoE, Andrew Bailey warned in a January that a third lockdown will send gross domestic product (GDP) falling by over 4% at the start of this year.
The bank then cut overall growth forecast to 5% for 2021 from 7.25%, with a prediction of a hike in 2022 from 6.25% to 7.25%.
Bailey said: “The MPC’s central forecast assumes that Covid-related restrictions and people’s health concerns weigh on activity in the near term, but that the vaccination programme leads to those easing, such that GDP is projected to recover strongly from the second quarter of 2021, towards pre-Covid levels.”
He said the progress of the vaccination programme across the UK was “very good news.”
He said, “I want to congratulate and pay tribute to everybody who’s involved, it’s a great story and it is reflected in our forecast.”
“The Covid vaccination programme would be expected to lead to an easing of social distancing restrictions, reduced economic uncertainty, and higher activity, although the timing of those effects is hard to predict,” the Bank added.