The new deputy governor of the Bank of England sees no imminent end to the economic downturn, which he believes is as bad as the crash of the 1970s.

Charlie Bean told the BBC yesterday that the malaise could “drag on for some considerable time” given that on every occasion sentiment improved “another grenade” exploded in financial markets.

Speaking at the annual conference of central bankers at Jackson Hole, Wyoming, he described the mood as one of “considerable caution”. “We’ve got our fingers crossed that things will improve. But there is the recognition that there is still a long way to go yet.”

However, he held out the prospect of inflation falling next year and improved economic growth if oil prices and credit markets were to stabilise.

Financial Times, Daily Telegraph