UK remains on recovery track, says economist

“The recovery in the United Kingdom looks set to continue,” Mr Dale wrote in the foreword to the central bank’s latest bulletin, a collection of research articles.

Domestic and international issues would help determine the strength and durability of the UK recovery, he said.

The UK economy unexpectedly contracted in the fourth quarter of last year but recent data has suggested it is picking up again.

Mr Dale joined Andrew Sentance and Martin Weale in voting to raise interest rates last month to curb inflation, which is running at double the bank’s two per cent target. But the three were outnumbered by the other six members of the BoE’s Monetary Policy Committee who voted to keep rates at 0.5 per cent.

Mr Dale said the correlation between growth in broad money and GDP had changed as a result of the financial crisis, and a given level of growth now was likely to be associated with weaker money growth than before.