Monday September 24th, 2018 11:35AM

Bank of England chief issues another Brexit warning

By The Associated Press
Related Articles
  Contact Editor

LONDON (AP) — Bank of England Governor Mark Carney warned Friday that developments surrounding Brexit are "the most significant influences" on the economic outlook for Britain.

A day after he reportedly told Cabinet members that a disorderly Brexit could lead to economic problems akin to the 2008 global financial crisis, Carney said the bank was ready for any eventuality.

"The Bank of England is well-prepared for whatever path the economy takes, including a wide range of potential Brexit outcomes," he said in a speech in Dublin, Ireland.

"We have used our stress test to ensure that the largest U.K. banks can continue to meet the needs of U.K. households and businesses even through a disorderly Brexit, however unlikely that may be."

Brexit is officially due to take place in March but it's still unclear what Britain's relationship with the EU will be. On Thursday, the British government published another set of papers detailing what it thinks would happen in a disorderly Brexit, whereby Britain crashes out of the bloc with no deal.

The government warned that British driving licenses may not be eligible in continental Europe in such a scenario and that mobile phone users may see hefty increases in roaming charges.

At a special Cabinet debate on Brexit, Carney went further. According to multiple British media outlets, he warned ministers of a 35 percent crash in the British housing market, which plays a big role in the economy, as well as a severe increase in unemployment and disruptions in daily activities like air travel.

Despite all the warnings, many Brexit-backers have dismissed Carney's warning as another piece of scaremongering from an official some have called the "high priest of Project Fear." Financial markets took in stride Carney's reported warnings, with the pound firm at $1.3123, while the FTSE 100 index of leading British shares was up 0.2 percent at 7,297.

Ahead of the Brexit referendum in June 2016, Carney was one of many officials warning that a vote to leave the EU could lead to a recession in Britain and a rise in unemployment. Growth did slow but the economy did not contract and unemployment has continued to fall to 43-year lows.

"The problem with Carney's gloomy prognostications on Brexit is that his previous forecasts have been completely wrong on this subject," said Neil MacKinnon, global macro strategist at VTB Capital.

Still, Carney is widely respected among investors and at the top of the government after helping to calm financial markets in the immediate aftermath of the Brexit vote.

Earlier this week, he agreed to extend his time as governor by seven months until Jan. 2020. Britain's Treasury chief Philip Hammond said Carney can help "smooth" the Brexit process after the country's scheduled departure from the EU.

  • Associated Categories: Associated Press (AP), AP Business, AP Business - Economy, AP Business - Financial Markets
© Copyright 2018 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
The Latest: Hurricane Florence moves ashore
The barrier island of Emerald Isle is under water, with ocean waves rolling in over a six-foot storm surge and crashing into homes.
7:23AM ( 21 minutes ago )
Stocks continue to rise on hopes for trade war cease-fire
Global stock markets are up again on hopes that the United States and China will call time-out in their escalating trade feud.
7:20AM ( 23 minutes ago )
Hurricane Center: Florence close to landfall in N. Carolina
The National Hurricane Center said early Friday that Florence was about to make landfall in North Carolina bringing with it life-threatening storm surge and hurricane strength winds
7:12AM ( 31 minutes ago )
Associated Press (AP)
Turkish leader Erdogan criticizes central bank's rate hike
Turkish President Recep Tayyip Erdogan has reproached the central bank's move to sharply raise interest rates, saying the country would "see the results" of the bank's independence
6:30AM ( 1 hour ago )
Monster typhoon barrels closer to north Philippines, China
Typhoon Mangkhut has retained its ferocious strength and shifted slightly toward more densely populated coastal provinces as it barrels closer to the northeastern Philippines, where a massive evacuation is underway
5:18AM ( 2 hours ago )
Global shares continue rally after Wall Street gains
Global shares are mostly higher, continuing their rally after gains on Wall Street and hopes that regional trade tensions may ease
4:43AM ( 3 hours ago )
AP Business
Congress passes spending deal, bids to avert gov't shutdown
The House has approved a $147 billion package to fund the Energy Department, veterans' programs and the legislative branch, a day after the Senate passed the measure. It now goes to President Trump for his signature.
5:25PM ( 14 hours ago )
Technology stocks, led by Apple, push Wall Street higher
US stocks rise as Apple, Microsoft and Qualcomm lead a round of gains in technology companies and health care companies also move higher
5:14PM ( 14 hours ago )
US stocks jump as inflation slows; tech rebounds
US stocks rise as Apple, Microsoft and Qualcomm lead a round of gains in technology companies and health care companies also move higher
4:45PM ( 14 hours ago )
AP Business - Economy
ECB's Draghi: Trade war chief worry for global economy
The European Central Bank is pushing ahead with its plan to gradually phase out its monetary stimulus, saying it is confident in the region's growth.
10:43AM ( 21 hours ago )
World stocks rise on report of US-China trade talks
Many global markets are higher following a report that the U.S. has proposed a new round of trade negotiations with China.
8:34AM ( 23 hours ago )
European Central Bank takes next step in tapering stimulus
The European Central Bank confirmed Thursday it is halving the size of its monthly bond-buying stimulus program as it scales back its post-crisis emergency efforts before stopping them at the end of the year.
7:51AM ( 23 hours ago )
AP Business - Financial Markets
The Latest: Hurricane Florence moves ashore
The barrier island of Emerald Isle is under water, with ocean waves rolling in over a six-foot storm surge and crashing into homes.
7:23AM ( 21 minutes ago )
Stocks continue to rise on hopes for trade war cease-fire
Global stock markets are up again on hopes that the United States and China will call time-out in their escalating trade feud.
7:20AM ( 23 minutes ago )
Hurricane Center: Florence close to landfall in N. Carolina
The National Hurricane Center said early Friday that Florence was about to make landfall in North Carolina bringing with it life-threatening storm surge and hurricane strength winds
7:12AM ( 31 minutes ago )
US Open umpire tells AP he is focusing on 'working again'
The chair umpire who penalized Serena Williams in the U.S. Open final tells The Associated Press he is 'just focusing on this tie and working again'
7:11AM ( 32 minutes ago )
No joke as ex-comic becomes Slovenia's new prime minister
Slovenia's new prime minister used to make people laugh, but there is nothing funny about his new role
7:08AM ( 36 minutes ago )