Former MPC member believes UK still at risk of double dip

| September 21, 2010 | 0 Comments

Professor David Blanchflower, a former member of the Bank of England’s Monetary Policy Committee (MPC), has today said he still doesn’t rule out a double dip recession.

In June, Mr Blanchflower, who is professor of economics at Dartmouth College in the US, warned the coalition Government that tough spending cuts could pose a threat to the fragile recovery.

Speaking to Sky News today, Mr Blanchflower said: “The housing market is slowing, house prices are falling, GDP growth is slowing, the claimant count rose this month and the latest evidence from KPMG is that hiring in the private sector is slowing.

“I absolutely don’t rule out a double dip (recession); I think the probability of it is rising daily,” he added.

He also believes interest rates will have to remain under the 1% level for the “next four or five years”.

Professor Blanchflower received a CBE in the Queen’s Birthday Honours last year after correctly predicting in November 2007 that the UK may face a recession.

He also called for interest rate cuts a year before his fellow members on the MPC.

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