by Peter Spence, Economics Correspondent
Interest rates could rise or fall if the UK votes to leave the European Union, Mark Carney, the Bank of England Governor has admitted, as he told MPs that uncertainty surrounding a Brexit result would make it difficult to determine how best to respond.
In response to questions from MPs on the Treasury Select Committee, Mr Carney said that ?City traders had developed almost a “Pavlovian” response to bad news. They assumed that “any time something bad happens, central banks ease policy”, choosing to unleash quantitative easing or slash interest rates.
In the event of a vote to leave the EU, the decision for the Bank of England would not be so clear cut, the Governor stressed.