Slowdown would be good, says economist

THE CHIEF economist of the Yorkshire Bank has said that a slowdown in the UK’s economic recovery would be a “very good thing.”

Outlining the state of the country’s finances to an event co-hosted by the Bank’s Corporate & Structured Finance team and TheBusinessDesk.com in the West Midlands, Tom Vosa said a fast recovery would put upward pressure on interest rates, and could leave over-leveraged businesses stranded.

He said: “We don’t expect to see the Q2 boom continue. A slowdown in the UK economy at this moment in time is a very good thing. If we were growing by 3%, interest rates would have to be much higher and monetary policy would have to tighten far more aggressively.

“What we need is a long pause and slow and steady growth – enough to keep interest rates at a low level. And if that continues we can slowly deleverage also.”