BoE study on effects of EU exit by Britain – reports | Real news would be if there was no study

Reports in a number of financial papers, including the Wall Street Journal and the Financial Times, have it that an email that was sent in error by a BoE official to the British Guardian newspaper has revealed that the central bank is to set up a task force under the deputy governor, Jon Cunliffe, to examine the economic implications of the promised referendum on EU membership in the UK in case the country’s removal from the EU is carried.

The referendum is due to be held before 2017. In the meantime the British government will be travelling to Brussels and to all the capitals of the member states in order to negotiate a better deal for the country so that the Conservatives to be able to recommend to the voters that they should stay in. There will also, no doubt, be concessions made by Britain in return for reforms that it might want from the EU. Some of these will almost certainly be directly aligned to the responsibilities of the Bank of England.

The real news would be if there was no study

The BoE issued a statement on its web site in relation to the matter:

“Today, information related to planned confidential Bank work on the potential implications of a renegotiation and national referendum on the UK’s membership of the European Union made its way into the public domain, due to an internal email sent inadvertently to an external party.

It should not come as a surprise that the Bank is undertaking such work about a stated government policy. There are a range of economic and financial issues that arise in the context of the renegotiation and national referendum.  It is one of the Bank’s responsibilities to assess those that relate to its objectives.

It is not sensible to talk about this work publicly, in advance. But as with work done prior to the Scottish referendum, we will disclose the details of such work at the appropriate time.

While it is unfortunate that this information has entered the public domain in this way, the Bank will maintain this approach”.

We maintain the view that this is something of a storm in a teacup. The real news would be if it was discovered by a newspaper that the Bank of England had made a policy decision to ignore any possible withdrawal of the UK from the EU, or the implications of any re-negotiation of its membership terms.