The U.K.’s bet on “draconian” spending cuts and some tax increases will slow growth in real income and may reverse the nation’s economic recovery, according to David Blanchflower , a former Bank of England policy maker.
Former Bank of England policy maker David Blanchflower said the risk of a deflation “nightmare” means officials including Federal Reserve Chairman Ben S. Bernanke should keep stimulus in place until there’s more evidence that private companies are spending again.
Austerity measures proposed by the U.K.’s new coalition government run the risk of reviving the recession unless Bank of England Governor Mervyn King loosens monetary policy, former BOE member David Blanchflower said.
Central banks should continue to keep rates low to stimulate growth because workers’ wages aren’t rising, damping any increase in inflation, according to David Blanchflower , a former policy maker at the Bank of England.
A Bank of England stimulus expansion appears to be finance minister George Osborne ’s “only” backup plan as government spending cuts risk a renewed recession, former policy maker David Blanchflower said.
Former Bank of England policy maker David Blanchflower said the next governor of the central bank should be someone with “clean hands” after recent banking- industry scandals appeared to have ruled out several candidates.