Brexit

British Central Bank switches to crisis mode

After the Brexit vote, the British Central Bank sees stability risks for the financial sector in the Kingdom. Therefore, you fans in a first step, some rules for the actors on the financial markets.

As a reaction to the shock waves of the Brexit vote in the economic and financial world, the British Central Bank has switched to a crisis mode. The Bank of England (BoE) warned on Tuesday of serious consequences for the financial stability of the country by the “Yes” of the population to exit the EU. In order to preserve the financial world from worse, loosened it with immediate effect, the capital rules for banks. “The UK is in a period of uncertainty and significant economic adjustments,” said BoE chief Mark Carney in London. The monetary authorities were ready to provide for the functioning of markets. In the course of a day, want to vote also Finance Minister George Osborne with the tips of the banking industry. The share markets in Europe were again on the descent.

The pound Sterling fell by almost two cents to a 31-year Low of 1,3112 dollars. To the Euro, the pound fell to the lowest level since two and a half years. “Investors have to Worry about the political uncertainty in the UK,” said analyst Sonja Marten of the DZ Bank.

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Out of fear of a resumption of the global financial crisis, the ECB and other Central banks after the Brexit vote, have the trading rooms of large banks with control requests bombed. As Reuters insiders learned from the financial industry, gave the British and the US Central Bank and the ECB in a timely manner a comprehensive picture of the activities in the market, to be able to early on impending turbulence detect. A Banker said that never before had such control calls so often and so consistently. Apparently, there had been the concern, the surprising Anti-EU vote could lead to the financial markets to such serious problems as the collapse of US investment Bank Lehman brothers in the autumn of 2008.

Sufficient liquidity is present

Also, the British Central Bank is more on the hat: “In case of emergency, we can provide enough liquidity”, – said Carney. Out of fear of a shortage of credit supply, the BoE loosened the requirements for banks. You don’t have to for now put aside more money for worse times. The already approved special capital buffers remain suspended until at least June 2017, not hot, however, that the financial institutions were given more scope for higher dividends, Carney. Rather, lending to companies and households should be stimulated.

The Central Bank in London had made after the Brexit vote, a loosening of its monetary policy in view. In the course of the summer and probably the monetary stimulus would be needed, Carney said recently. Investors expect the BoE lowers the base rate in the summer – possibly even up to 0.0 percent. Currently, he is with 0.5 per cent is already at a historically low level. It is expected to be a prolonged Phase of uncertainty, making the economy and, in particular, the British export prospects clouded.

The mood among the entrepreneurs on the island has deteriorated to the Brexit vote already solid. In the latest survey by the research Institute YouGov and the Centre for Economics and Business Research, 49 percent of the firms indicated to evaluate the General economic Outlook for the next twelve months are pessimistic. Before the Referendum, only 25 percent were of this view. And the British Department store chain John Lewis is the reluctance of consumers to feel: In the week after the Referendum, the revenues grew only by 2.1 percent. In the week before the start of the summer sales, the Plus still at 7.3 percent.

hb/nm (rtr)