UK: Vote to leave could lead to lower growth and higher inflation - BNZ

Kymberly Martin, Senior Market Strategist at BNZ, notes that overnight the Bank of England left its cash rate unchanged at 0.5% and its asset purchases steady.

Key Quotes

“The accompanying statement highlighted the risks ahead if the UK votes to leave the EU. It said a vote to leave could lead to a materially lower path for growth and a notably higher path for inflation. It also stated it could pose risks to the global economy via “financial market and confidence channels”.

However, a later scheduled speech by the BoE’s Governor was cancelled after a pro-EU law-maker was shot and killed when meeting with her constituents. UK 10-year yields have made new lows below 1.07%.”