No Brexit deal would have a big economic consequence, which will prompt interest rate review and leave many bankers idle, Mark Carney, governor of the Bank of England, said today in his testimony before the Treasury Committee.
Britain and the European Union have negotiated a transitional agreement that would effectively keep Britain a non-voting member from Brexit day in March 2019 until the end of 2020, but this agreement has not yet been ratified.
Carney added that the BoE's promise is to be as prepared as possible. Failure to reach an agreement would prompt the Bank of England's Monetary Policy Committee to reassess economic expectations and interest rates. Also, Carney said that British banks have enough capital and cash reserves to withstand unregulated exit.
