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The British economy is likely to return to growth within the next six to nine months, though the recovery would be slow, Bank of England policymaker David Miles said in an interview with the Independent newspaper.
"We may get a couple of quarters pretty soon of very small increases in GDP. If you take that technical definition, we might be out of the recession in six or nine months," Miles told the newspaper.
Echoing remarks made by BoE governor Mervyn King, Miles warned that the difference between recovery and recession may not be noticeable to many people.
"This is going to be a protracted period of a return to a more normal level of activity," he said.
"If you ask the question, 'When will growth return to a level when, say, unemployment stops rising?' I fear that's a little bit further down the road and I think that's a more realistic definition of coming out of recession."
On September 9, data released by the Office for National Statistics showed that the unemployment level stood at 2.47 million in the three months to July, a 14-year high.
"It is likely, unfortunately, that unemployment will continue rising for some months yet. There is already a substantial amount of slack. That degree of slack is likely to increase for some months yet," he said.
According to the daily, Miles hinted that the bank's quantitative easing policy would continue until the economy staged a much more vigorous recovery, widely assumed to be unlikely before the end of next year. He also suggested that the Monetary Policy Committee would revisit that issue of extending quantitative easing literally every single meeting.
Miles gave little hint that the central bank is ready to reverse its unprecedented policy of cutting interest rates to 0.5% and its GBP 175 billion programme of quantitative easing.
He said the amount of spare capacity in the economy meant there is very little inflationary pressure, implying rates could stay very low well into next year.
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