DUBLIN (Reuters) – The Bank of England and Britain's largest banks are well prepared for a disordered Brexit, said Governor Mark Carney on Friday, among reports he warned that could lead to a crash.
Mark Carney, Governor of the Bank of England, is participating in an event in Dublin, Ireland, September 1
The British media reported on Thursday that Carney had told senior officials earlier today that A chaotic Brexit could lead to a drop in house prices up to 35 percent over three years as well as a growing interest rate.
Carney did not treat this prospect directly in his speech at the National Bank of Ireland, although these forecasts are similar to scenarios that BoE told banks last year to ensure they had watched.
"The Bank of England is well prepared for the way the economy takes, including a wide range of potential Brexit results," said Carney, which closely matches previous languages about the preparations for Brexit.
"We have used our stress test to ensure that the UK's largest British banks can continue to meet the needs of British households and businesses, even through an odd Brexit, but unlikely it may be. Our job is not to be hoped for best, but to plan for the worst, "he added.
British economic growth has slowed since June 2016's Brexit vote, but it has not stopped BoE interest rates twice in just over a year, as it has estimated that the long-term prospects for non-inflationary growth had weakened.
BoE said after its monetary policy committee in September that meetings about future interest rates would depend a lot on how households, businesses and financial markets responded to Brexit.
"The appropriate political answer is not automatic and will depend on the balance of effects on demand , supply and exchange rate, says Carney on Friday.
Meanwhile, the uncertainty surrounding Brexit had weighted wage growth, although the latest data still showed a download, he said.
The main part of Carney's speech focused on the long-term impact of technological changes on employment.
"At present, there is some evidence to continue to assess the likely size and perseverance of all that increases in structural unemployment. Monetary policy makers must be warns of this opportunity, update their assessment as the transition occurs, "he said.
Writing by David Milliken; Editing Andy Bruce and Toby Chopra