But Andrew Sentance, a member of the bank’s nine-strong rate-setting committee, added that policy makers needed to be ready to crack down on inflation as import and services prices rise. Sentance was speaking a day after official statistics revealed that Britain’s worst recession since World War II is officially over -- but only just. A feeble 0.1 percent rise in gross domestic product in the final quarter of 2009 was enough to officially end a grinding 18-month recession, but fell short of expectations of a stronger 0.3 to 0.4 percent rise.
The Office for National Statistics also acknowledged that the figure could be revised up or down by around 01.-0.2 percent in the next two estimates for the quarter.
Comparing the exit from recession to the experience of ”bumping along the bottom” after the downturn of the early 1990s, Sentance said it was “very understandable” that there is still a lot of nervousness and uncertainty about the future pace of growth.” Sentance said the economy was facing opposing pressures.
“If the headwinds from the financial crisis and the consolidation of public finances dominate the outlook, the balance of risks to inflation are likely to be to the downside,” he said in the text of a speech prepared for the British Property Foundation in London.
