![\"Bank](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/07\/bank-of-england.jpg\")
<\/p>\nThe Governor of the Bank of England has delivered a stark warning as Andy Burnham prepares to take office.<\/p>\n
Speaking to MPs, Andrew Bailey said the UK’s biggest economic challenge cannot be ignored.<\/p>\n
Mr Bailey said the country’s weak economic growth should be the new Government’s top priority, warning Britain has struggled to grow its economy for almost two decades.<\/p>\n
Appearing before the Treasury Committee, he said: “The overall message I would give is that I think the big issue is growth in the economy.”<\/p>\n
Mr Bailey said the UK’s weak growth has persisted for around 16 to 17 years and stressed it is a long-term problem rather than the fault of any one Government.<\/p>\n
“So this is not a story about any one government… but I think it’s important because a critical structural issue,” he told MPs.<\/p>\n
Andy Burnham is on course to become Britain’s next Prime Minister as early as next week after securing the backing of more than 85 per cent of Labour MPs.<\/p>\n
The former Greater Manchester mayor received a further 27 nominations on Monday, taking the total number of Labour MPs supporting his leadership bid to 349.<\/p>\n
The Bank of England Governor has urged the incoming Prime Minister to focus on one issue above all others<\/p>\n
| GETTY<\/p>\n
The Bank of England’s comments come ahead of the latest economic figures from the Office for National Statistics, due to be released on Thursday.<\/p>\n
Deutsche Bank expects the data to show the economy shrank by 0.1 per cent in May.<\/p>\n
If confirmed, it would mark the second consecutive monthly contraction after the economy also shrank by 0.1 per cent in April, the first monthly decline since August last year.<\/p>\n
Before that, the economy grew by 0.3 per cent in March and 0.4 per cent in February.<\/p>\n
The April decline was driven by the services sector, which makes up the largest part of the UK economy, despite growth in construction and manufacturing.<\/p>\n
Sanjay Raja, Deutsche Bank’s chief UK economist, described services activity as “sluggish” in May across information, professional, financial services and real estate sectors.<\/p>\n
The conflict between the US, Israel and Iran continues to weigh heavily on Britain’s economy through persistently high fuel and energy costs.<\/p>\n
![\"Deutsche](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/07\/deutsche-bank-and-roman-abramovich.jpg\")
Deutsche Bank expects the data to show the economy shrank by 0.1 per cent in May<\/p>\n
| GETTY <\/p>\n
These elevated prices squeezed both businesses and households throughout April and May, though wholesale costs have eased somewhat in recent weeks.<\/p>\n
Chancellor Rachel Reeves acknowledged the domestic fallout, stating: “It was not a war we wanted or joined, but one that will have an impact at home.”<\/p>\n
Government ministers have cautioned that economic repercussions from the Iran conflict could linger for eight months beyond any ceasefire.<\/p>\n
Food industry figures have also warned that supermarket prices could surge by up to 10 per cent later this year as the war’s inflationary effects filter through.<\/p>\n
Mr Bailey emphasised that economic expansion cannot occur without a stable financial system, responding to questions about whether regulatory frameworks might be hampering growth.<\/p>\n
![\"Andy](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/07\/1784076431_255_andy-burnham.jpg\")
Andy Burnham is on course to become Britain’s next Prime Minister as early as next week<\/p>\n
| GETTY<\/p>\n
“We will not get growth if we don’t have financial stability,” the Governor told the committee, while noting signs of resilience within the financial sector.<\/p>\n
Despite the gloomy outlook, some economists identified potential bright spots. <\/p>\n
Ms Raja noted it was “not all bad news,” pointing to retailers reporting that promotional offers and warmer temperatures had lifted demand for outdoor furniture and fans.<\/p>\n
England’s World Cup progress could also provide a fillip, with pubs and bars expected to benefit from increased custom.<\/p>\n","protected":false},"excerpt":{"rendered":"The Governor of the Bank of England has delivered a stark warning as Andy Burnham prepares to take…\n","protected":false},"author":2,"featured_media":692084,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[19306,3490,84,59,2222,229,2331,56,44208,54,55],"class_list":["post-692083","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-andy-burnham","tag-bank-of-england","tag-business","tag-gb","tag-money","tag-politics","tag-sgg","tag-uk","tag-uk-politics","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/692083","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=692083"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/692083\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/692084"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=692083"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=692083"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=692083"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}