Without a permanent emergency lending facility to support the banking sector, the
The report's findings follow research that shows the
It said: "The
With so many external influences on the
The report is likely to be seen as confirmation that the Bank's immediate response to the crisis was flawed.
Last year the Winters review lambasted the Bank for restricting emergency funds at the height of the financial crisis because it feared rewarding reckless banks and undermining "moral hazard".
The review argued that the central bank should maintain close links with the banking sector, monitoring its activities and providing funds when they are in short supply on global money markets. It said
The Bank's latest report agrees with Winter's criticism that the central bank should keep open a funding window to cope with periods when credit is difficult to come by.
The report, How Have World Shocks Affected the
"Overall, world shocks are estimated to account for around two thirds of the weakness in the level of
It has always been the Bank's view that the 2008 crisis was caused by banks with unduly large overseas liabilities and not domestic pressures. Former governor
King also argued that the
The report found that most harm to growth came from volatile financial markets and uncertainty driven by the euro crisis.
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