Brexit vote may spark recession, Mark Carney warns

The Bank of England has given its starkest warning yet that a UK vote to leave the EU could hit the economy.

A leave vote may cause sterling to fall and unemployment to rise, according to the latest minutes of its Monetary Policy Committee (MPC).

Mark Carney, the Bank’s governor, warned that the risks of leaving “could possibly include a technical recession”.

Vote Leave said there was no need for more forward guidance from the Bank.

The Bank had not compiled formal forecasts about the possibility of a recession – defined as two consecutive quarters of negative growth – resulting from a Brexit vote, Mr Carney added.

Chancellor George Osborne said the UK now had a “clear and unequivocal warning” from the MPC as well as the Governor of the Bank of England about the risks of a Leave vote.

“The Bank is saying that it would face a trade-off between stabilising inflation on one hand and stabilising output and employment on the other,” he said.

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Economy, General