Would Brexit Lead to a UK Rate Cut? – Investec

Would Brexit Lead to a UK Rate Cut? – Investec

9 May 2016, 15:21
Roberto Jacobs
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Would Brexit Lead to a UK Rate Cut? – Investec

Research Team at Investec, notes that the Sunday Times was reporting yesterday that the Bank of England has asked banks to prepare for the possibility of a rate cut if Britain leaves the EU, without attributing the statement to any particular source.

Key Quotes

“Certainly a so-called Brexit would leave policy makers with a complex situation to deal with. Although there is debate whether they would cut interest rates to combat a likely slowdown of growth (forward-looking PMI data is already slowing), or whether they would be forced to raise interest rates if the Pound substantially weakened and threatened the inflation outlook. Perhaps, if this report is to be believed, it would be one and then the other.”


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