Over a month after a national lockdown was declared in an attempt to limit the spread of coronavirus, it is clear that Britain is heading for the deepest recession in living memory. Prime Minister Boris Johnson launched unprecedented restrictions on March 23, telling the British public they must stay at home, bringing life as the nation knew it to a halt. Thousands of lives have been lost to COVID-19, while millions of jobs are at risk with the economy effectively in deep freeze.
Pubs and restaurants remain shut, high streets are empty, and planes are grounded.
The coronavirus lockdown has already wiped £50billion off the economy as the UK plunges into the deepest slump.
The Office for Budget Responsibility estimated that the closure of schools, shops, offices and factories was costing Britain £2billion a day.
In an exclusive interview with Express.co.uk, though, Jonathan Portes, Professor of Economics and Public Policy at King’s College, London, explained how the pound is in a much stronger position than many other countries in Europe.
He said: “In terms of currency movement, the pound tends to be more volatile. That is true.
“However, in structural terms, the euro area is more at risk.
“Because of the nature and design of the euro: it has a central bank for lots of different countries.
“That introduces lots of problems when it comes to coordination and the ability of the central bank to respond to problems in the individual member states.”
Mr Portes added: “The UK has the advantage to have one central bank and one treasury.
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“And in times of crisis, there is a close relationship between the two.
“They acted together in 2008 and 2009 to respond to the financial crisis and they are doing it now.”
Mr Portes’ claims were echoed by the former Governor of the Bank of England Lord Mervyn King in an interview with Sky News last month.
Lord King said: “What we can take comfort from here I think is that the Bank of England and the Government are working very closely together.
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“I think you can see that around the world nations are responding to this.
“People have to accept that tremendous sacrifices are made for other people. And the community in which we do that most naturally is the nation state.
“That is not something they have created in the euro area. They failed to create a fiscal union.
“Now, someone will hope that the crisis we are facing will lead them to do that but they have not got the political legitimacy to do that.”
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