Global central banks raise cash offer to quell Brexit panic

Frankfurt, June 24: Central banks across the world offered the financial system fresh funds and intervened in currency markets, in an effort to reassure investors sent into panic by the UK’s vote to leave the European Union.

After a majority of Britons voted to end their 43year membership of the EU in a referendum, the Bank of England, the European Central Bank and the Bank of Japan issued statements stressing the availability of liquidity to keep the banking system running. The BOJ led the Swiss National Bank and the Danish central bank in displaying readiness to sell their local currencies to cap gains caused by investors seeking haven from the tur moil.

The Group of Seven nations are said to plan to confer later on Friday, and officials from about 60 global monetary authorities will meet this weekend in Basel, Switzerland. Beyond the initial gyrations, central banks will face questions over how they can support growth and hit inflation targets at a time when policy instruments are already stretched, and a new threat to growth hangs over Europe in particular.

“Central banks are always the first line of defense, and they can do something to stabilize the situation but they can’t fundamentally alter a negative trajectory,” Guntram Wolff, director of the Brussels-based Bruegel Institute, said by phone. “Monetary policy will be operating

Brussels, June 24: EU chiefs on Friday told Britain to start negotiations to quit the bloc “as soon as possible”, after outgoing Prime Minister David Cameron said he would leave the negotiations to his successor. “We now expect the United Kingdom government to give effect to this decision of the British people as soon as possible, however painful that process may be,” said a joint statement after Britons voted for a Brexit . “Any delay would unnecessarily prolong uncertainty.” The statement was issued by EU president Donald Tusk, European Commission chief Jean-Claude Juncker, EU Parliament leader Martin Schulz and Dutch premier Mark Rutte, whose country holds the rotating presidency of the bloc, after crisis talks in Brussels. Cameron announced he would step down to make way for a new leader by October, adding that the new prime minister would be responsible for officially triggering Article 50 of the EU’s Lisbon Treaty to start Britain's divorce from the bloc. But European leaders made it clear they were keen to get the process over with as quickly as possible and wanted Britain to start talks immediately. “We have rules to deal with this in an orderly way,” the joint statement said. “We stand ready to launch negotiations swiftly with the United Kingdom regarding the terms and conditions of its withdrawal from the European Union.” It added that Britain remained bound by EU law “until it is no longer a member.” Reuters in huge uncertainty, and the realisation that antiEuropean sentiments can actually win will weigh on sentiment and could bring back the possibility of recession.”

Italian and Spanish bonds fell and German bunds climbedasinvestorsshunned higheryieldingdebtinfavour of haven assets. The additional yield investors demand to hold Spain’s 10-year bonds over equivalent-maturity bunds rose to the highest since 2014, while Italy’s yield spread widened to the most in almost a year. US treasury yields fell the most in seven years. Bloomberg