Bank of England: British economy could decline 14 percent

May 7 (UPI) -- A Bank of England report said Thursday the British economy could fall as much as 14 percent this year, which would be its worst showing in more than 300 years.

The bank's Monetary Policy and Interim Financial Stability Reports blamed the coronavirus pandemic for the fall.

"Social distancing measures are in place in [Britain] to stop the spread of COVID-19," the reports said. "As a result, many businesses are unable to produce or sell their goods and services. It also means that many households have less money coming in. Some people are working fewer hours and others have lost their jobs."

Bank Gov. Andrew Bailey said in a statement the economy's recovery will depend on how quickly society can get past the pandemic.

"The scale of the shock and the measures necessary to protect public health means that a significant loss of economic output has been inevitable in the near term despite this very significant policy support," he said. "Economic prospects are highly dependent on the evolution of the pandemic and how governments, households and businesses continue to respond to it."

The bank said it believes the disruption to the economy is "temporary" and it will recover once social distancing guidelines are lifted.

"We have put in place a package of measures that will support households and businesses, help the economy recover and keep the financial system safe and stable," the bank said. "Since January, we have cut interest rates and injected a further [$248] billion into the [British] economy through quantitative easing. That reduces the costs that some households and businesses face and will help the economy to recover."

Those packages, though, were not able to keep businesses like British Airways, Virgin Atlantic and Debenham from laying off workers. The British government will announce its first-quarter figures next week.