This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.

You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/7698614.stm

The article has changed 5 times. There is an RSS feed of changes available.

Version 0 Version 1
Bank insider urges deep rate cuts Bank insider urges deep rate cuts
(about 5 hours later)
The current financial crisis may be more far-reaching than even the 1929 crash, a Bank of England policymaker has warned.The current financial crisis may be more far-reaching than even the 1929 crash, a Bank of England policymaker has warned.
Professor David Blanchflower is a member of the Bank's Monetary Policy Committee (MPC), and has often been a lone voice in urging rate cuts.Professor David Blanchflower is a member of the Bank's Monetary Policy Committee (MPC), and has often been a lone voice in urging rate cuts.
Now he has said big interest rate cuts are needed to avoid a deep recession.Now he has said big interest rate cuts are needed to avoid a deep recession.
UK rates are at 4.5%, after the Bank cut them by half a percentage point earlier this month.UK rates are at 4.5%, after the Bank cut them by half a percentage point earlier this month.
The cut was part of a co-ordinated move with both the Federal Reserve and European Central Bank (ECB).The cut was part of a co-ordinated move with both the Federal Reserve and European Central Bank (ECB).
On Wednesday the Fed cut its key rate further, to just 1%.On Wednesday the Fed cut its key rate further, to just 1%.
"My view remains that interest rates do need to come down significantly - and quickly," Prof Blanchflower told an academic audience in Canterbury."My view remains that interest rates do need to come down significantly - and quickly," Prof Blanchflower told an academic audience in Canterbury.
"If rates are not cut aggressively we do face the prospect of a relatively deep and long-lasting recession.""If rates are not cut aggressively we do face the prospect of a relatively deep and long-lasting recession."
'Synchronised downturn''Synchronised downturn'
His comments follow those recently made by Bank of England governor Mervyn King and Prime Minister Gordon Brown that the UK is probably heading towards recession.His comments follow those recently made by Bank of England governor Mervyn King and Prime Minister Gordon Brown that the UK is probably heading towards recession.
And Prof Blanchflower said international financial problems could turn out to have long-lasting repercussions.And Prof Blanchflower said international financial problems could turn out to have long-lasting repercussions.
"It is even possible that this event may turn out to be more significant than the 1929 crash which primarily involved bank failures in the United States," he said."It is even possible that this event may turn out to be more significant than the 1929 crash which primarily involved bank failures in the United States," he said.
HAVE YOUR SAYTwo companies that I have worked for have either closed their doors or laid people off. Marie, Atlanta, USASend us your comments
"The current difficulties in financial markets are more global in nature and more comparable to what happened in the First World War.""The current difficulties in financial markets are more global in nature and more comparable to what happened in the First World War."
He also said a range of surveys of UK economic activity had shown a marked downturn since last summer.He also said a range of surveys of UK economic activity had shown a marked downturn since last summer.
"It is not sufficient to consider the data month by month until it emerges that the UK is in recession."It is not sufficient to consider the data month by month until it emerges that the UK is in recession.
"I believe this trend has been apparent for some time. The synchronised downturn in so many business surveys should have led us to realise sooner that the UK economy was entering a recession.""I believe this trend has been apparent for some time. The synchronised downturn in so many business surveys should have led us to realise sooner that the UK economy was entering a recession."