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Bank of England warns of Brexit risks

Tuesday, March 08, 2016 - 01:26

BOE governor Mark Carney faces probing questions from UK politicians as the central bank prepares for the economic fallout from a referendum on EU membership - and warns of the impact on the economy and on the UK as a banking sector hub. David Pollard reports.

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Mark Carney - in the chair before a parliamentary committee - and simultaneously performing a tightrope walk. Critics on both sides of the Brexit argument ready to pounce if he leans too far either way. If Britain leaves after a June referendum, inflation and the economy will be hit, he warned. And banks could move elsewhere. (SOUNDBITE) (English) BANK OF ENGLAND GOVERNOR, MARK CARNEY, SAYING: "One would expect some activity to move ... a number of institutions are contingency planning for that possibility." But if Britain stays, that too carries warnings. (SOUNDBITE) (English) BANK OF ENGLAND GOVERNOR, MARK CARNEY, SAYING: "To be clear, we do think there were risks from remaining in the European Union and risks particularly related to the development of the Euro area." Before his appearance, the Bank of England detailed extra liquidity to support commercial banks up to and around the vote. The governor himself tasked by UK prime minister, David Cameron, with laying out the costs and benefits of EU membership. (SOUNDBITE) (English) PANMURE GORDON CHIEF ECONOMIST, SIMON FRENCH, SAYING: "Governor Carney has a very difficult path to tread here. The independence of the Bank of England - in fact, the independence of all central banks - is central to their modus operandi." But also coming under attack ... one member of the committee hitting out at a previous report from the Bank that put a positive spin on EU membership. Jacob Rees-Mogg denouncing it as not only 'speculative' but as also 'beneath' the Bank's dignity.

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Bank of England warns of Brexit risks

Tuesday, March 08, 2016 - 01:26