A recession is already with us and could last all next year and beyond, says the Bank of England. It’s a gloomy outlook, tempered only by the Bank’s monetary policy committee signalling that the downturn is unlikely to be as bad as expected, despite its jolt to mortgage payers last week with a 0.75 percentage-point increase in the base rate.
Interest rates will peak at a lower level than the 5.25% financial markets previously expected – somewhere between 3% and 4% – which means the recession, rather than being the longest in 100 years, will be short and shallow.
