BoE warns of Brexit risks, pro­vok­ing ire of eu­roscep­tics

The Pak Banker - - FRONT PAGE -

Ex­it­ing the Euro­pean Union could hurt Bri­tain's $2.9 tril­lion econ­omy and prompt some banks to aban­don Lon­don's global fi­nan­cial pow­er­house, Bank of Eng­land Gov­er­nor Mark Car­ney said on to­day. In his strong­est in­ter­ven­tion so far in Bri­tain's de­bate about EU mem­ber­ship, Car­ney said he was not mak­ing any rec­om­men­da­tion about how to vote in the June 23 ref­er­en­dum but that un­cer­tainty cre­ated by an exit could hurt the econ­omy.

Asked about the im­pli­ca­tions of an exit for Bri­tain's huge bank­ing in­dus­try, he said some ma­jor fi­nan­cial in­sti­tu­tions were con­sid­er­ing a pos­si­ble move if the coun­try voted to leave the EU. "One would ex­pect some ac­tiv­ity to move," Car­ney told law­mak­ers in the Bri­tish par­lia­ment. "I'd say a num­ber of in­sti­tu­tions are con­tin­gency plan­ning for that pos­si­bil­ity." Af­ter clinch­ing a deal from other Euro­pean Union lead­ers last month in Brus­sels, Prime Min­is­ter David Cameron asked the cen­tral bank, which is in­de­pen­dent from the govern­ment, to set out the facts about mem­ber­ship.

Though Car­ney also said there were risks from re­main­ing in­side the EU due to the greater in­te­gra­tion planned by the 19-mem­ber Eu­ro­zone, he praised Cameron's deal.

"The set­tle­ment ad­dresses the is­sues the Bank iden­ti­fied as be­ing im­por­tant, given the likely need for fur­ther in­te­gra­tion of the euro area, to main­tain­ing its abil­ity to achieve its ob­jec­tives," Car­ney, a Cana­dian, said in a let­ter to Bri­tish law­mak­ers.

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