The Bank of England has issued a fresh warning that a vote to leave the EU in next week’s referendum risks knocking economic growth, pushing the pound sharply lower and sending shockwaves through the global economy.
Against the backdrop of jittery financial markets, the Bank also revealed its top policymakers had been briefed by staff on contingency planning for the referendum as it readies measures to prevent markets seizing up in the event of a leave vote next week.
Announcing its decision to keep interest rates at their record low of 0.5%, the Bank said the referendum on 23 June was the biggest immediate risk to UK financial markets, and perhaps those overseas, and that the current uncertainty was already denting spending. The pound has weakened in the run-up to the vote as opinion polls have pointed to a lead for the leave vote and the Bank warned in minutes to its latest rate-setting meeting that it would fall further in the event of Brexit.
