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Mark Carney swipes at Boris Johnson, as he warns Brexit will make UK households poorer

2 min read

Mark Carney has warned the Bank of England will not be able to prevent the damage to household incomes as Britain adjusts to life outside the European Union. 

In major speeches at Mansion House this morning, Mr Carney also underlined the importance of transitional arrangements with the EU to mitigate the impact of Brexit on the UK economy.

The Governor of England also made a thinly-veiled attack on pro-Brexit Foreign Secretary Boris Johnson when he said it would soon become clear if life outside the bloc was “a land of cake and consumption”.

That was an apparent reference to Mr Johnson's previous claim that when it came to cake, he was “pro having it and pro eating it”.

Mr Carney warned before last year’s referendum that leaving the EU would have negative economic consequences, but his speech this morning prioritised the transition to Brexit.

In his most strident comments about the economic risks of Brexit since last year's vote, Mr Carney said the Bank of England would not be able to shield households from the turmoil to come.

“Monetary policy cannot prevent the weaker real income growth likely to accompany the transition to new trading arrangements with the EU,” he said.  

“But it can influence how this hit to incomes is distributed between job losses and price rises. And it can support households and businesses as they adjust to such profound change.”

The Governor added: “Depending on whether and when any transition arrangement can be agreed, firms on either side of the channel may soon need to activate contingency plans.

“Before long, we will all begin to find out the extent to which Brexit is a gentle stroll along a smooth path to a land of cake and consumption.”

Elsewhere in his speech, Mr Carney said it was “not the time” for the Bank’s Monetary Policy Committee to increase interest rates, after three of the committee voted in favour of a rise at the most recent meeting. 

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