The Bank of England Governor Mark Carney was heavily opposed to UK’s European exit but has turned his opinion towards the latter after admitting Europe has the most to lose from the Brexit. In a meeting with the Commons Treasury Select Committee, Mr Carney said EU’s financial stability is threatened by a UK exit as UK’s financial services plug out of the system. With the country as the centre of European finance for many SMEs and multinational corporations, the Europe will lose once the Brexit pushes through.
Mr Carney said: “At the point of leaving, there will be capacity taken out because certain institutions are not authorised.” He said it would affect Europe more than the United Kingdom. Early during the Brexit campaign of both the Leave and Stay campaigns, Mr Carney said the Brexit will have a huge impact in the short term and could increase the risk of recession.
Instead of a continuing weak pound sterling, the UK economy expanded effectively after the Brexit. According to figures three months after the Brexit, UK consumers continue to spend as investors regain confidence in the country.
Mark Carney said the UK should make it a point to maintain market access even after the Brexit. Carney said the BoE’s move to cut interest rates effectively helped keep afloat the economy and remove the immediate adverse effects of the UK Brexit.