This is the worst-case scenario that is most dangerous: indiscriminate exit from the European Union without consent and without a transition period. And, obviously, there is something. In such a scenario, the gross domestic product of Great Britain would fall by 8% the following year, and the unemployment rate would rise to 7.5%.
This is the main lesson of the report, published on Wednesday by the Bank of England, made at the request of the British deputies. The predictions presented by the Prime Minister, Theresa Mai is struggling to support the approval of the Brexit deal.
Drop pound quarter
The central bank also predicts a sharp drop in the pound sterling, which has lost a quarter of its value and an increase in inflation to 6.5% against 2.4% at present.
Leaving the European Union in an orderly manner, the UK would have done a little better, but the economy would still have decreased by 2% over the next 15 years compared with the economic situation without Brexit.
Later, the economy will recover, and growth will rise again, but will be significantly less than before.
Banks are ready for the worst
The good news, however, is in this very dark picture. All banks in the United Kingdom have successfully passed stress tests. In concrete terms, this means that they are ready to withdraw from the European Union without consent.
Banks can continue to finance households and businesses in the context of declining housing prices and rising unemployment.
Central Bank Governor Mark Carney warned that his central bank is ready for Brexit, better or worse. Worst of all would have been an even greater crisis than the one that crossed the country in 2008 during a global financial storm.
But Mark Carney warned Wednesday at a press conference: “Our task is not to hope for the best, but to prepare for the worst,”This is said.