He reiterated the Bank would take “whatever action is needed to support growth”, attaching a caveat that: “Monetary policy can not immediately or fully offset the economic implications of a large, negative shock”.
Advertisement
However, he said while the central bank is likely to help the economy, monetary policy can not immediately or fully offset the economic implications of a large, negative shock.
Mr Carney said: “The result of the referendum is clear”.
The MPC is due to meet in July and August with a decision on the measures to be taken more likely in August.
Carney’s dovish speech on Thursday helped lead to an immediate further surge for both United Kingdom and U.S. stocks, while the British pound came under renewed and increased pressure. “And it will look through a temporary period of higher inflation resulting from a sharp decline in the pound”.
The yield on Ireland’s 10-year bonds fell through 0.5 per cent for the first time today to reach as low as 0.447 per cent, having been as high as 0.85 per cent last week and over 14 per cent at the height of the financial crisis in 2011.
Another index of smaller, often more domestic companies, the FTSE 250, is down 8 percent. The AIM All-Share was up 0.5% at 711.25.
‘It is no doubt true that on a currency basis the FTSE 100 is still down in euro and USA dollar terms, but it is also true that it is one of the highest yielding blue-chip benchmarks at over 4%, which could well be providing a pull factor in an era of ever-decreasing interest rates’. The committee members try to keep inflation close to 2% (between 1% and 3%).
European currencies were trading on a mixed bias on June 30. The final manufacturing purchasing managers’ index rose more than initially estimated to 52.8 in June from 51.5 in May.
“Commercial real estate transactions had been cut in half since their peak previous year”. The MPC warned unanimously of economic risks if “Leave” won the referendum.
“We expect financial market volatility to persist as events unfold and uncertainty over the future of the UK’s relationship with the European Union will feed into the real economy”, the consultancy firm said.
Britain can deal with the change of leaving the bloc and the Bank has a plan to deal with any uncertainty thrown up by the exit, said the chief.
USA stocks are indicated to open lower. Futures point the Dow Jones Industrial Average and Nasdaq 100 down 0.2% and the S&P 500 index down 0.3%. Berenberg upgraded funeral services provider Dignity to Buy from Hold. In tandem, a potentially broad range of regulations might change. The stock traded up 5.7%.
Mr Carney was speaking to business leaders in his second speech since the UK’s vote to leave the EU.
Advertisement
Banks were among the worst-hit stocks in the market rout that followed the vote on Friday and Monday.
