BoE forecasts GDP growth at zero for 2012 and below target inflation

The Bank of England has cut its forecast for economic growth this year to almost zero and has predicted inflation will be below target in the medium term.

In its quarterly inflation report, released today, the Bank said it expects to see no growth in the economy for 2012, down from the 0.8% predicted in the May report. At a press conference today, Bank governor Mervyn King described "storm clouds" rolling over the UK from the euro area. In its report, the Bank said the outlook for UK growth remains "unusually uncertain", with the greatest threat to economic recovery being an inadequate policy response to the eurozone crisis. "The MPC sees no meaningful way to quantify the size and likelihood of the most extreme possibilities associat...