‘The big squeeze’: what the papers say about Bank of England’s recession forecast
Friday’s papers are united in gloom, placing front and centre the Bank of England’s grim forecast of a lengthy recession and inflation rising to its highest level since 1980.
The Financial Times goes big with a “red alert” graphic showing GDP and inflation alongside an image of Bank governor Andrew Bailey, under the headline: “BoE warns of long recession as interest rates rise by half-point”. It notes that the outlook is worse than that of the US or the EU.
“Britain slides into crisis”, says the Times, creating a similar graphic showing interest rate rises, under the title “black Thursday”. Economics editor Mehreen Khan says the Bank “unleashed a catastrophic set of forecasts that would have been scarcely believable a year ago”.
The Guardian gives plenty of room for the grim climate news but its lead story is the latest rate rise, the Bank’s sixth, and the forecast of 13% inflation. It lays the blame squarely on Vladimir Putin over his invasion of Ukraine, quoting Bailey’s line that “there is an economic cost to the war”.
Two papers – the i and Metro – opt for some business language with “the big squeeze” as their headline. Couched around a red inflation graph, the i’s bullet points note that economists expect interest rates to rise to at least 3%, and that house repossessions loom for some already struggling with the cost of living crisis. Metro quotes Bailey as saying the interest rate rise will hit the less well off hard but that “the alternative is even worse”.
The Mirror targets Boris Johnson and Nadhim Zahawi – variously on honeymoon or on holiday – saying the prime minister and chancellor are “missing in action” in its headline, set against a graph of the apocalyptic inflation forecasts.
The Daily Record is equally annoyed with their holidays.
The Telegraph focuses on the income shock for families amid the combination of a rise in energy costs and a forecast recession. “Recession to cause record drop in income” is the headline. The lead story weaves in the duelling views of leadership rivals Liz Truss and Rishi Sunak on how to tackle the crisis, focusing on the merits or otherwise of their tax cut plans.
The Mail carries a scathing assessment of Bailey’s skills as governor. The headline is “Banker who’s running out of credit” and it reports he has been forced to deny claims he has been “asleep at the wheel”. The Bank should have raised interest rates last year, it says.
The Express says “Recession on way … time to batten down the hatches” and reports that the only good news was for retirees who are on track for 10% pension rises.
The National takes the opportunity to suggest that unhitching from the faltering British bandwagon might be wise, with the headline “Now is the time to get Scotland out”.