In its quarterly report the Bank of England highlights the uncertainties surrounding the exit of the European Union. It has also lowered its growth forecasts for the next two years.

Clouds pile up around Brexit. Still scheduled for March 29, 2019, no political solution is currently retained and the possibility of an exit without agreement remains a possible solution.

An alarming scenario for the British economy according to Mark Carney, Governor of the Bank of England. "While many companies are stepping up their preparations, the UK economy as a whole is not yet ready for an exit without agreement and without transition" he said at a press conference on Thursday. To avoid the worst, Theresa May went to Brussels on Thursday to start new negotiations.

Brexit, Theresa May rushes her country to a no-deal

In this uncertain environment, the Bank of England (BoE) has announced that it will maintain its monetary policy. However, it has revised its growth forecast for the next two years downward. For 2019 and 2020, the institution expects respectively 1.2% and 1.5%, against 1.7% for the two years according to its previous forecast in November. A slowdown due to the global economic slowdown but especially to the negative effects of uncertainties around the Brexit.

Brexit smog hovers above UK economy

In particular, the BoE Governor said that "The fog of Brexit causes short-term volatility in economic statistics and especially creates a series of tensions for the economy, for companies". In addition he also added that the various surveys conducted by the bank show that companies fear a significant decline in production, investment and employment in case of Brexit without agreement.

Brexit, one in three British companies ready for exile

To ensure the stability of the institution during this turbulent period, the governor's mandate has been extended until early 2020. The Bank of England has been steadfast in recent months to warn of the consequences of the vagueness surrounding Brexit. At the end of November, it had unveiled a particularly dark scenario in the absence of an agreement, which would lead to a collapse of the pound sterling and a huge shock to the economy.

The Cross (with More Bank)

And also