If you look it up in the Report you will see that according to our estimate only a very small amount of excess supply – ¼% of GDP – remained in the economy. But we couldn’t be certain of this. Even in the most benign interpretation the economy had gone through a temporary soft patch. The majority of indicators were pointing in one direction. And it felt like there was at least a risk that, perhaps reflecting the unusual position of the UK, something more material was going on – perhaps one of the risks I highlighted earlier was crystallising. That was why I, along with the majority of the Committee, decided to vote again to leave Bank Rate unchanged. How do I see the economy evolving from here? It is still early days. We are still only two thirds of the way through Q2, less far through the Q2 data cycle, and only a month has passed since our last MPC meeting. Even so, the data we have had so far suggests our interpretation of the slowdown in Q1 as temporary looks to be being borne out. Consumer confidence and consumer credit both picked up in the latest data, as did retail sales and several business surveys. That included the latest services PMI output balance, representing 80% of the economy. So far at least our May judgement looks on track. Looking ahead, my central expectation for the economy is in line with the MPC’s best collective judgement as expressed in our inflation report forecasts.
What’s going on? Speech given by Dave Ramsden, Deputy Governor for Markets and Banking, Bank of England  Barclays Inflation Conference, London 7 June 2018  I am grateful to William Abel, Harvey Daniell, Bianca Ginelli Nardi, Raf Kinston, Simon Kirby, Elliot Luciani-Kane, Rebecca Maule, Sanjay Odedra, Tom Smith, Pawel Smietanka and Brad Speigner for their assistance in preparing this speech, and Clare Macallan, Michael Saunders and other Bank staff for their helpful comments and suggestions. 1  All speeches are available online at www.bankofengland.co.uk/speeches  An unusual position UK GDP growth has slowed following the Brexit referendum, and it slowed even more in the first quarter of this year. In the MPC’s May Inflation Report we are forecasting that it will remain subdued over the forecast period. If our forecast materialises, annual growth will have been between 1¼ and 2% for five consecutive years from 2016 to 2020. To give some context, annual average GDP growth has been in this range in only eight of the 50 years before that period, and three of those were since the financial crisis. It’s been said before but it bears repeating: the UK economy is in an unusual position. Over the past few years, meanwhile, unemployment has fallen from a high of 8.5% to a forty year low of just 4.2%. Employment has similarly picked up to record highs.