ECB's Lane warns that abrupt Brexit would be a "genuine shock" to financial stability
Bank of Ireland governor Philip Lane spoke to the Financial Times
- Abrupt British departure would be a "genuine shock" threatening the stability of Europe's financial system
- City of London is the wholesale HQ of the EU
- Brexit is a bigger headache if there is no trade deal - so that is what we are looking at closely; that and the impact on financial services
- (Regarding ECB) Until we have signs of inflation, it is appropriate for QE to continue
- There needs to be discussion on change in message by ECB that acts as some guide to what to expect after September - when QE is planned to end
Lane is also a member on the ECB governing council - and he touches on some monetary policy stuff as well in his talk with FT here.
Some general comments by Lane - no biggie really. It's quite too soon to tell what sort of Brexit we will see, so any assessments on the situation can be very subjective still. It's been a quiet day so far for EUR and GBP. EUR/USD now at 1.2262 while GBP/USD is at 1.3791. EUR/GBP has traded within a 13 pips range today, now at 0.8891.