In his speech on Wednesday 24 September 2014, Roger Bootle reported an overall upbeat outlook with reference to the UK economy. He believed recent strong performance will continue through 2015 and 2016, despite the weakness of our key trading partner, the Eurozone.
Bootle suggested that interest rates would not rise, possibly until late 2015, as the Bank of England wasn’t concerned as much with sterling’s relative value, as it is about inflation and the lack of real wage growth
Office of Budget Responsibility
Roger believes that the Office of Budget Responsibility is underestimating economic spare capacity and that we may be in a period of sustained strong growth and low inflation. The Chancellor’s budgets are based on OBR numbers and there may be more progress in dealing with the national debt than anticipated. Bootle expressed that while the UK’s debt is still high, its trajectory is stabilising and the end of austerity is at least in sight.
Bootle’s mid-term view was positive. In contrast to the doomsayers, he argued that the end of austerity and the end of the Eurozone crisis, when it eventually comes, mean that long-term prospects for the UK are strong. Then like a true economist, he said that he just hopes that he will still be around to enjoy it.
During the Question and Answer portion of briefing, Bootle replied to several questions including one requesting his opinion on the lasting impact of the Scottish referendum. He said he believed that no permanent damage was done to international perceptions of the UK, and that the referendum fallout may lead to positive developments in the way the UK governs itself.