Bank of England warns of slow British recovery

The UK’s troubled IT industry is unlikely to swiftly recover from the double dip recession, the Bank of England has warned.

Governor Sir Mervyn King said recovery would “zig-zag” thanks to the eurozone’s woes having a negative impact.

According to the Guardian,  inflation in the UK has risen and will not fall towards the two per cent target until the middle of next year.

King predicted that the UK could be stuck in a “low-growth” environment, with economic problems in the eurozone and the rest of world hurting the local economy.

The Bank has downgraded its growth forecast for 2013 to about one percent and said it would be three years before the UK gets back to pre-financial crisis levels.

Previously the bank has predicted that inflation might fall towards the government’s two per cent target in the first half of next year, but it looks like inflation would stay higher for longer.
King said that the country face the rather unappealing combination of a subdued recovery, with inflation remaining above target for a while.

On the plus side, it appears that companies are starting to hire younger workers. Unemployment in the UK has fallen to its lowest total for more than a year.

The number of unemployed fell by 49,000 to 2.51 million in the three months to September, taking the jobless rate to 7.8 per cent from 7.9 per cent.

According to the Office for National Statistics, almost all of the 49,000 fall was due to a decline in youth unemployment.

Meanwhile the numbers of older people claiming unemployment benefit rose by 10,100 last month to 1.58 million, the highest since July.