BoE policymaker Michael Saunders said that “it is quite plausible that the next move in Bank Rate would be down rather than up.” He noted that “even without a no-deal Brexit, a scenario of persistently high uncertainty is probably the most likely outcome. And, “that would probably imply continued weakness in business confidence and investment, with softer job growth that drags on consumer spending, Saunders added, “it might well be appropriate to maintain a highly accommodative monetary policy stance for an extended period and perhaps to loosen policy at some stage, especially if global growth remains disappointing.”
In case of disorderly Brexit, Saunders repeated BoE’s position that policy options won’t be automatic. And he warned that no-deal Brexit would “probably immediately leave some firms unprofitable. Others might face longer-term questions about their viability, or whether they would be better off relocating.”
