BOE's Carney: Brexit Risks Have Started to Crystallize

The transcript discusses the significant financial risks following a referendum, highlighting concerns about the UK's current account deficit and the impact on sterling. It notes a slowdown in portfolio flows and a potential tightening of credit conditions, particularly in commercial real estate. The uncertainty has delayed major economic decisions, but there are positive aspects, such as support for exporters due to sterling depreciation and a fall in corporate borrowing costs. Financial markets have managed the volatility well.

What was identified as a significant near-term domestic risk to financial stability?

• The referendum

• Inflation

• Unemployment

• Trade deficits

What impact did the referendum have on UK equities and corporate debt?

• Stable market conditions

• Slowed portfolio flows

• Increased investments

• Rising share prices

How did the referendum affect commercial real estate in the UK?

• Rising property values

• Falling share prices of property rates

• Stable transaction volumes

• Increased capital inflows

What is a potential consequence of the tougher economic outlook mentioned in the transcript?

• Improved housing market activity

• Delayed major economic decisions

• Increase in business investments

• Decrease in vulnerable households

What positive effect did the sharp depreciation of sterling have?

• Increased import costs

• Decreased foreign investments

• Support for UK exporters

• Higher inflation rates