UK Chancellor of the Exchequer (finance minister) Sajid Javid has acknowledged that an economic recession may be necessary to bring down inflation. Speaking to the BBC on 9 December 2019, Javid said: “The priority always in the UK is ensuring that we keep inflation under control. In some circumstances it could mean that we may get into a situation where there might be a slight recession — and I’m being honest about the economic cycle — but I’m very confident that we can manage that in a responsible way.”
Javid’s comments come just months after the Bank of England raised interest rates for the first time in a decade in August 2019, in a move designed to help bring down inflation. The rate has remained constant since then.
The UK economy has been slowing since mid-2017 and this year it is estimated to have grown by about 1.3 percent — its weakest annual growth in a decade. Inflation has been higher than the Bank of England’s target of 2.0 percent for two years, which has led to growing concerns about households’ ability to keep up with the increase in prices.
Despite acknowledging the possibility of recession, Javid also emphasized that he is confident that it would be managed responsibly. He said: “We can’t let inflation get out of control. But also we have to make sure that our economy stays resilient and that’s why I am confident that if we do have to make some tough decisions, that we can manage it in a responsible way.”