The Bank of England steps up its warnings about the economic risks if Britain votes to leave the European Union, saying that sterling could fall sharply, unemployment would probably rise and Britain could enter a technical recession. David Pollard reports.
Mark Carney may wish he had a crystal ball. With Britain's future hanging in the balance, forecasting the future almost impossible. His one certainty perhaps - more Brexit uncertainty lies ahead - and not just for the UK. (SOUNDBITE) (English) BOE GOVERNOR, MARK CARNEY, SAYING: "This issue is the number one issue that is raised with me and my colleagues every single time we meet a fellow central bank governor, foreign finance minister, head of a major corporation internationally." And despite his stated neutrality in the Brexit debate, he was clear about the consequences of Britain leaving the EU. (SOUNDBITE) (English) BOE GOVERNOR, MARK CARNEY, SAYING: "Material slowdown in growth, notable increase in inflation, that's the MPC's judgement." In fact, 'technical recession' is possible, he added. That's if Britain leaves. But in the meantime, the chance of a 'negative spillover' to the global economy. A sharp drop in sterling .... and for the UK, even slower growth - GDP marked down in the latest bank forecast. Leaving analysts with a struggle to calculate just how much of that's Brexit-related. (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER, SAYING: "It's arguably only been over the last couple of weeks or so where the Brexit debate has become increasingly loud, so it could actually be another month, or even two months, before we see the real effects of the Brexit uncertainty washing through to the UK economy." There'd been speculation some policymakers might even call for a cut this time around. But, unanimously, they voted to leave rates on hold. Perhaps hoping a falling pound might help in something almost forgotten amid Brexit worries: the battle to bring low inflation back up to target.