Two charts for the weekend. One shows UK GDP since before the recession and the other the Bank of England reaction with interest rates.
The key part to look at is the timing in 2007/8. Northern Rock went under in 2007, that was the start of the credit crunch. Yet, despite calls from all sides, the Bank of England was concerned at rising inflation and raised rates. In fact, only the Lehman crash made them take any action. Suffice to say this is not a glorious phase in the Bank's history.They did better in the crisis, but now that is over, its 1-1 with 20 minutes still to play.
It does signal how slow the Bank of England are to sense the change in the macro-inflationary environment; which bodes ill for the end of the current recession. The Bank seemed fixed on not raising rates for some time to come, yet inflationary factors are everywhere. Apparently not people's pay, but that can change in an instant.