The Bank of England has cut growth forecasts in half, forcing interest rates down to 4.5% as it attempts to stimulate the economy. This has raised fears over a new squeeze on living standards as growth has been weak and productivity tepid. In response to this announcement, Chancellor Rachel Reeves is receiving criticism as it is seen as a blow to her. The Financial Times reported the warning which stated that the economy would grow only 0.75% this year.
The Daily Mail has accused Chancellor Reeves, stating that a new era of stagflation is looming as a result of the situation. Stagflation, where there is flat growth and rising inflation, has caused concern. While Andrew Bailey, a Bank of England official, has backed the chancellor’s growth plans, she may have to raise taxes or cut spending to meet her own fiscal rules if the situation continues.
Many papers are claiming the chancellor’s job may be on the line, with some speculation that she could be replaced by Home Secretary Yvette Cooper. Although some sources have confirmed that this would not actually occur because of the unlikelihood of Reeves stepping down on her own accord. The Guardian and The Times both mention stagflation fears while The i says the growth and inflation warning are putting pressure on Reeves to boost the struggling economy.
The Daily Telegraph blames the “bloated state” for harming the economy. Rising public sector employment since lockdown has not been met with a rise in productivity, creating concern that the state is harming the economy. The Daily Mirror reports Gino D’Acampo is facing allegations of making sexual and aggressive comments to a string of women at work. D’Acampo firmly denied these allegations. The Metro blames a winter vomiting bug for patients occupying thousands of beds in hospitals, with over 96% of beds occupied last week. Meanwhile, The Sun reports that the late singer Liam Payne was considering a One Direction reunion before his death last year. Finally, The Daily Star has reported that “lazy gits live longer” and that relaxing on the sofa, having good sleep and not overdoing it at work could help you live an extra 10 years
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