Bank of England governor Andrew Bailey expressed concerns over the UK's economic stagnation, despite recent growth figures indicating a 0.1% expansion in GDP. While this performance was better than anticipated, Bailey emphasized that the overarching narrative of a static economy since spring persists. He noted the complexities of inflation, linking it to the balance of supply and demand. A shift towards low demand would potentially decrease inflation more rapidly, though he acknowledged a mix of both factors is likely influencing the current economic condition.
"We've had the GDP numbers slightly stronger than we thought it would be, but I don't think it changes the general story we have got, which is the economy has been quite static since late spring last year."
"The big question for us was to what extent is it demand and to what extent it is supply and demand, and that will go on being a big question for sometime."
"Clearly it matters as the more you think it is pure demand than that is going to bring inflation down faster. The more you think it is pure supply it will have the other effect."
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