The Bank of England would potentially cut interest rates and print more money if there were a "hard" Brexit, the Bank of England governor has signalled. In a speech in London, Mark Carney said the Bank's forecasts, which imply interest rates would go up in the coming years, were predicated on Brexit being a smooth process, with a negotiated deal between the UK government and EU.However, he added that if the transition wasn't smooth, the Bank's Monetary Policy Committee (MPC) could be expected to act similarly to how it did after the EU referendum result - when it cut interest rates from 0.5% to 0.25%, and electronically created an extra £60bn to buy assets through its quantitative easing programme.Speaking to a dinner of the Society of Professional Economists, Mr Carney said: "A more disorderly transition, or a materially different end state from our assumption, would have implications for monetary policy."To understand the MPC's potential response, businesses, households and … [Read more...] about Mark Carney signals ‘hard’ Brexit could see Bank of England print more money
Mark Carney has claimed that progress in Brexit negotiations towards a "deep and special" relationship with the EU could unleash a "boom in investment" as cautious bosses dust off growth plans that have been on hold. Consumer spending could also rocket, the Governor of the Bank of England said, in a significant boost for the economy’s prospects. Earlier this week he said Brexit had hit economic growth by 2pc and reduced household incomes by £900 relative to the outcome of a Remain vote in the referendum. But in a speech to economists in London he made clear that some of this could prove temporary if the Government makes progress in talks with Brussels. “If there is progress towards the new, deep and special partnership the Government is seeking, a boom in investment and potentially consumption could be unlocked, boosting output,” the Governor told the Society of Professional Economists. This could push economic growth up to more than 2pc per year in 2019, … [Read more...] about Brexit deal could unleash ‘boom in investment’, says Mark Carney
The economy is grounded. Growth has plunged even as the rest of the world pulls ahead. Family finances are under the cost. And it is Brexit’s fault, or so Mark Carney has said. GDP is 2pc lower than it would otherwise be and household incomes down £900, the Governor of the Bank of England told MPs, most likely because of the referendum. His comments generated a fierce response from defensive Brexiteers, not least the Foreign Secretary. "It is absolutely not the case that Brexit has damaged the interests of this country,” said Boris Johnson. The UK will "prosper" after Brexit thanks to its "ability to do unhindered and unfettered free trade deals" after leaving the European Union, he said, adding “We both want to be more outward looking than ever before and Brexit gives us the opportunity.” That is not quite a denial that the referendum has damaged growth, but it represents a more positive picture of the economy’s state than that … [Read more...] about Is Mark Carney right about Brexit?
0 Have your say A currency union between an independent Scotland and the rest of the UK is economically possible, the Governor of the Bank of England has said, but warned that it would require continued deep integration to function. Mark Carney said there were "political ramifications" to the kind of sharing of economic sovereignty that he said would be "highly desirable for an effective currency union".But he said it was for "others to judge" whether it was if a political union was essential for Scotland to continue using the pound, in comments that some pro-independence campaigners will claim as a softening of the Bank of England's stance on a currency union.It comes as a Growth Commission established by the SNP prepares to publish a long-awaited report on the economy of an independent Scotland, which is expected to recommend a separate currency following a transition away from the pound.READ MORE: Scottish independence: New currency plan if Yes wins new voteAhead of the … [Read more...] about Mark Carney: Independent Scotland currency union ‘economically possible’
Brexit has stunted the economy’s growth and cost households hundreds of pounds each, as the UK should have grown much more quickly in the past two years, Mark Carney has claimed. The economy has performed better than the Bank of England anticipated when the Leave campaign won the June 2016 vote. But the Governor of the Bank told MPs today that the economy would have been significantly stronger if the referendum had gone the other way, particularly as he fears the UK is missing out on a boost from stronger European and global growth. “If you look at where the economy is today relative to our forecast [on the eve of the referendum, based on a remain vote], it is more than 1pc below where it was,... To continue reading this article Start your free trial of Premium Access all Premium articles Subscriber-only events Cancel any time Free for 30 days then only £2 per week Try Premium Access one Premium article per week Register … [Read more...] about Are households £900 worse off because of Brexit? How Mark Carney crunched the numbers