Bank of England Governor Andrew Bailey claimed that Brexit will continue to have a “negative effect” on the economy.
He said the bank had not changed its view after issuing a series of foreboding warnings about terrible economic implications if the UK left the EU in the run-up to the 2016 referendum.
Yesterday, the Governor told a select committee of MPs that the negative consequences of Brexit were “built-in.”
Despite the UK winning a free trade arrangement with the EU and negotiating accords with nations such as Australia and New Zealand, Mr Bailey stated that not being a member of the group will severely impede the UK’s trade.
“The Bank of England has not changed its view on Brexit and trade for some time”, he told the Treasury committee.
“We have built into our view of the future that there is a negative impact.
“We have been unpopular, my predecessor was unpopular for saying this. We haven’t changed our view.”
Mark Carney, who headed up the Bank of England before Mr Bailey, grew a reputation for his repeated dystopian warnings on Brexit.
Prior to the 2016 referendum, he warned it would push the value of the pound down, “perhaps sharply”, cause a recession, and lead to a surge in unemployment.
After the vote, he continued to warn the decision would hit Britain’s growth.
His remarks led to anger from Tory MPs who saw him as a part of “project fear”, with Jacob Rees-Mogg going as far as to describe him as “one of the enemies of Brexit” in 2017.
“His statements have been consistently hostile,” he added.
Despite Mr Bailey saying the Bank stood by its previous assessments, he admitted yesterday it was hard to assess the true impact of leaving the EU.
High prices and worries of a recession are now plaguing the British economy.
The sharp jump in costs, on the other hand, has been duplicated throughout most of the world, with the rise in inflation owing largely to the aftermath of the war in Ukraine and the end of the Covid epidemic.
The crisis may also lead to a recession.
The Bank of England warned earlier that inflation might reach 10% by the end of 2022, and Mr Bailey made a “apocalyptic” prediction yesterday.
He predicted that the current cost of living crisis will worsen in the next months, owing to Russia’s invasion.
Ukraine and Russia is the big risk in a way,” he said.