Brexit could lead to recession, says Bank of England boss

The governor of the Bank of England, Mark Carney, has warned that the UK could be plunged into another recession if it votes to leave the European Union in the upcoming referendum.

Mr Carney said the risks of a brexit could “include a technical recession”, with Prime Minister David Cameron calling the warning “a very clear message” for voters.

In response, Campaigners behind the Vote Leave side have levelled criticism at Mr Carney, with one calling for his resignation, according to the BBC.

Further, the bank’s Monetary Policy Committee (MPC) has said that voting to leave could trigger a fall in economic growth and the strength of the pound, while unemployment could rise.

George Osborne, Chancellor of the Exchequer, has said the MPC and Mr Carney’s statements amount to “clear and unequivocal” warnings over the risks of leaving the EU.

He continued: “The bank is saying that it would face a trade-off between stabilising inflation on one hand and stabilising output and employment on the other.

“So either families would face lower incomes because inflation would be higher, or the economy would be weaker with a hit to jobs and livelihoods. This is a lose-lose situation for Britain. Either way, we’d be poorer.”

The BBC further reported that Conservative Jacob Rees-Mogg, MP for North East Somerset, called for Mr Carney to step down.

Mr Rees-Mogg commented: “I think it is unprecedented for the governor of a central bank to suggest that people should short his own currency.

“Suggesting sterling will fall sharply is simply not what responsible central bankers do.”

The Bank of England’s latest quarterly Inflation Report has forecast economic growth to slow during Q2 2016 but pick up in H2. The report also lowered growth predictions for the next three years.

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