BREAKING: Bank of England warns Pound would fall 25% under No Deal Brexit
In newly published figures, the Bank of England has warned that a 'disorderly Brexit' would see the economy shrink by 8 percent, while, house prices would fall by around a third.
If accurate, the forecasts would see the UK plunged into a deep recession reminiscent of the financial crash of 2008.
The Bank also predicts that unemployment would rise to 7.5 percent, while commercial property prices collapse by 48 percent.They would also expect Interest rates to reach 4 percent.
The figures project that it would take until 2023 for the UK economy to once again start growing, but from a far lower starting point than before.
The report was drawn up by the bank in response to a request from Nicky Morgan MP, Chair of the House of Commons' Treasury select committee.
At a press conference on Wednesday, the Bank's Governor, Mark Carney, said there would be two possible outcomes of a 'No Deal' Brexit: “disruptive and disorderly”.
“In both scenarios, tariffs and other trade barriers are introduced suddenly next spring. The UK recognises EU product standards but the EU does not reciprocate."
“In the more severe or disorderly scenario, the UK’s border infrastructure does not cope smoothly with new customers’ requirements for some time." he warned, adding:"By the end of 2023, gross domestic product (GDP) is almost 10 per cent lower than in May 2016."
“The impact of Brexit will depend on the direction, magnitude and speed of the effect of reduced openness on the UK economy." Carney continued.
“The direction of the effects of reduced openness is clear: lower supply capacity, weaker demand, a lower exchange rate and higher inflation."
“The worst case scenarios assume that adjustments to deintegration happens more rapidly than it has over the past decades of integration."