AT this juncture, the UK economy brings to mind those jack-in-the-box toys that were so popular in decades past. In this case, the “jack” is the spectre of recession.

The Brexiters have wound up the toy’s handle and, as some very English tune such as Victorian London favourite ‘Pop Goes the Weasel’ plays, the spectre has sprung out of the box.

Not surprisingly, its emergence has frightened both businesses and consumers. It is a most unwelcome sight, particularly given that the vast majority of people are still living with the grim aftermath of the global financial crisis and 2008/09 recession.

The Conservative austerity programme has, since it started in 2010, choked off the chance of any convincing economic growth and cranked up the pressure on so many households.

The ill-judged austerity policies thus ensured the handle did not have to be turned too much further before the spectre of recession popped up again.

The Bank of England’s Monetary Policy Committee yesterday did the monetary policy equivalent of throwing the kitchen sink at the spectre of recession, in a seeming attempt to put a lid back on things.

It unveiled a comprehensive package of measures but, even as it did so, it made it plain they would not be sufficient to stop the UK electorate’s Brexit vote on June 23 from making growth much weaker than it would have been with a Remain result.

The Bank is projecting the UK will, by the skin of its teeth and with the stimulus package, avoid recession. However, given the Bank is forecasting near-stagnation for the UK economy in the second half of this year and observing the continuing political shambles in the wake of the Brexit vote, it would be foolhardy indeed for anyone to claim the spectre of recession has been vanquished.

While the effectiveness of the MPC’s measures might be limited, the scale of them suggests policy-makers have very major concerns about where the economy might be headed with Brexit.

The MPC voted unanimously to cut UK base rates by a quarter-point to a fresh record low of 0.25 per cent. The records go back to when the Bank was founded in 1694.

UK base rates had been at their previous record low of 0.5 per cent since March 2009, with MPC members having debated, after they reached that level, whether a further cut would actually make much difference given benchmark borrowing costs were so close to zero anyway.

The MPC yesterday launched a “Term Funding Scheme” to try to ensure lower base rates are passed on to businesses and consumers in terms of reduced borrowing costs. This scheme will provide funding for banks at interest rates close to base rates.

The Bank, explaining the rationale for this, acknowledged it might be difficult for banks and building societies to cut deposit rates much further. Hard-pressed savers would probably agree.

The Bank signalled most MPC members stood ready to cut base rates even further at a future meeting, to “a little above zero”, should incoming economic data be broadly consistent with the Old Lady of Threadneedle Street’s latest forecasts in its August inflation report yesterday. This assurance also appears to underline the seriousness of the situation.

And, rounding off the kitchen sink approach, the MPC voted, albeit by a majority, to extend the scale of its existing quantitative easing programme, aimed at stimulating the economy, from £375 billion to £435bn by buying a further £60bn of Government bonds, and to purchase up to £10bn of corporate bonds.

The Bank is forecasting a rise in UK unemployment because of the Brexit vote. It predicts an increase in the International Labour Organisation measure of unemployment from five per cent in the current quarter to 5.4 per cent by the same period of next year. And it expects ILO unemployment to be 5.6 per cent in the third quarter of 2018.

The latest Report on Jobs, published today by financial information company Markit, shows recruitment consultancies in Scotland recorded the steepest drop in permanent placements for seven years in July.

The Bank predicts UK gross domestic product growth of just 0.1 per cent this quarter. It sees “little growth” over the second half of this year. And it predicts expansion next year of only 0.8 per cent, having forecast 2017 growth of 2.3 per cent only three months ago.

The Conservative Government, after the Brexit vote, was swift to abandon its former plan to eliminate the UK’s fiscal deficit by 2020, in a seeming attempt to make the spectre of recession disappear.

A survey by the Institute of Directors has this week revealed that this organisation’s members, who had been so keen on this 2020 target ahead of last year’s General Election, are very approving of the Tories’ economic u-turn following the Brexit vote. This is perhaps not surprising, given IoD members are now, overall, distinctly pessimistic about the UK economic outlook. For good reason.

The economic warning signs indicate things are likely to get worse from here.

Surveys this week from the Chartered Institute of Procurement & Supply have confirmed UK economic output tumbled last month at the fastest pace since the depths of the last recession in the spring of 2009.

Monetary policy-makers and politicians might be pushing hard to put a lid on the situation. But the Brexiters certainly seem to have no idea of how to put the spectre of recession back in the box. And there is, sadly, no sign we are going to see a coherent plan to deal with the Brexit nightmare from the UK Government any time soon.

All in all, it is difficult to escape the notion we are heading for the economic equivalent of a loud twanging noise, which leaves the jack and the springs lying all over the floor.