"Hanes Dwy Ddinas" or "Tale of Two Cities" - speech by Mervyn King

Speaking at the Cardiff Business School today, Mervyn King, Deputy Governor of the Bank of England, says that the past five years have been a period of remarkable stability for the UK, which reflects well on the new framework for monetary policy.
Published on 18 June 2001

Mr King says there are two sources of uncertainty facing the UK at present, one domestic and the other international, and both are related to imbalances. In the UK, there is "a 'tale of two cities' in which some industries are experiencing the worst of times, with declining manufacturing output, and others the best of times, with the latest retail sales figures showing an increase in the volume of sales over the past twelve months of 6.4%". He notes that this is the first time since the 1870s that the external contribution to growth has been negative for a period of five consecutive years, and that negative contribution is likely to continue for the foreseeable future.

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