LONDON (Reuters) – The Bank of England said Britain faced its weakest economic growth in 10 years in 2019, blaming mounting Brexit uncertainty and the global slowdown.
Below are comments from Mark Carney and other policymakers:
MARK CARNEY ON FOG OF BREXIT
“The fog of Brexit is causing short term volatility in the economic data, and more fundamentally, it is creating a series of tensions in the economy, tensions for business.”
CARNEY ON LEVEL OF UNCERTAINTY
“We arrive where we’re sitting here today and we don’t know, we do not know what form of arrangement could be struck. There are still as almost a wide of range of possibilities as there were the morning after the referendum.”
CARNEY ON TUSK’S HELL COMMENT
“I was surprised by those comments yesterday. If one wants to be theological, “Do not judge because you too will be judged.”
“(What) we are all looking for is the principles in these negotiations, and of course in the United kingdom it is (up to) parliament ultimately to take their time and complete their work diligently but come to a conclusion of where we are headed.”
CARNEY, ASKED WHETHER HE WAKES UP REGRETTING THE EXTENSION TO HIS TENURE
“I don’t wake up in the morning any more Larry, I wake up in the middle of the night.
“No, the reason I extended was to remain here during a period that could be slightly more volatile or could involve a slightly more difficult transition …, so obviously I don’t regret it all.”
CARNEY ON PROBABILITY OF NO-DEAL OUTCOME
“I would have described no deal, no transition a few years ago as a low probability event. I’d describe it now as not the central scenario, so in other words … yes, the probability has gone up.
“Seven weeks before Brexit date and the range of potential outcomes is very wide, time is limited and I think it is a statement of the obvious.”
CARNEY ON SHOCK LEVELS
“If there is a shock, which at least in terms of central expansion of business, households and financial markets, a no-deal, a no-transition Brexit, would be, it would be a shock, a negative shock, that would further increase the probability of negative quarters.
“But for our core central expectation is that we will have higher uncertainty and there will be a path to some sort of arrangement.”
CARNEY ON BREXIT PLANNING
“Although many companies are stepping up their contingency planning, the economy as a whole is still not yet prepared for a no-deal, no transition exit.”
“In terms of our agent surveys, most recent surveys, of businesses and their preparedness, half of them say they are not ready. And the half that say they are ready… ready means ‘we’ve done all we can’.
“Many of the risks, many of the complications that they see… of a no-deal, no-transition arrangement, they are not able to self-solve.”
CARNEY ON THE FINANCIAL SYSTEM
“The core of the financial system is ready for whatever form Brexit takes. And that is a good thing, it doesn’t solve all the other issues related to Brexit. It doesn’t necessarily help the half of companies in the country that are not ready for that scenario.
“But it means the financial sector will cushion the blow, and be part of the solution, rather amplifying a shock and being part of the problem.”
CARNEY ON STERLING
“Any persistent adjustment in sterling would likely have material consequences for inflation on the policy relevant horizons due to the slow speed of path through into consumer prices.”
CARNEY ON BREXIT IMPACT
“We have … recognised the intensification of uncertainty, the bigger impact uncertainty is having on those spending decisions and we have projected it out, projected it to last a little longer than we had previously expected.
“So a recognition that not everything may be tied up in a nice package by the end of March.”
CARNEY ON PARLIAMENT’S ROLE
“This is a time of quite considerable uncertainty about one of the most important issues, the most important issue, facing this economy, facing households, facing businesses, a medium term issue, it is important that parliament gets it right and they are taking the time to do that.”
CARNEY ON THE UK ECONOMY
“The fundamentals of the UK economy are sound. The financial sector is resilient. Corporate balance sheets are strong, and the labour market is tight.”