LONDON (Reuters) – The Bank of England is more likely to cut interest rates than raise them in the event of a no-deal Brexit, rate-setter Silvana Tenreyro said, the latest BoE official to back the idea of coming to the economy’s rescue if it suffers a Brexit shock.

The BoE has said its response to a chaotic exit from the European Union would not be automatic because a fall in the value of the pound and the imposition of tariffs on trade could push up inflation, making the case for a rate hike.

But some individual rate-setters have said recently that they would probably back a rate cut.

“In my judgement, a situation where the negative demand effects outweigh those other effects is more likely, which would necessitate a loosening in policy,” Tenreyro said in a speech given in Glasgow.

“But it is easy to envisage other plausible scenarios requiring the opposite response.”

Last week Governor Mark Carney said the BoE would probably give more support to the economy if it suffers the shock of a no-deal Brexit.

Monetary Policy Committee member Gertjan Vlieghe has also said rates were most likely to stay on hold or fall in the event of a no-deal Brexit.

But on Wednesday his colleague Michael Saunders stuck to the view that they could move up or down.

Britain is scheduled to leave the EU on March 29 but Prime Minister Theresa May is still seeking last-minute concessions from Brussels to secure parliamentary approval for a deal.

She has also opened the way for a possible delay to Brexit.

A Reuters poll of economists published on Wednesday put the chances of a no-deal exit from the EU at 15 percent.

In the event of a smooth Brexit, Tenreyro said there would be a “small amount of tightening” needed over the next three years, although she added that she would need to see an increase in price pressures first.

Overall, Tenreyro’s comments fitted with a generally more downbeat stance adopted by the BoE last month, spurred not only by Brexit but also by a slowing global economy that she ascribed to trade tensions such as U.S. tariffs on imports from China.

Tenreyro said Britain’s economy had not been hitting the limits of its ability to grow without generating excessive inflation. Supply grew in line with demand over the last couple of years, if not faster, she said.

“Consequently, I suspect that we ended 2018 with some amount of spare capacity remaining in the economy,” Tenreyro said.

She said there was some evidence that “acting slightly later” in shifting policy might be less costly to the economy than it once was.

Despite recent weak productivity data, Tenreyro said she saw some evidence of a “mildly improving” trend emerging over the longer term — something that should help to ease inflationary pressures in the economy.

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