BOE's Carney on a Disorderly Brexit

The video discusses the need to consider multiple economic scenarios, particularly in the absence of an agreement. The committee has analyzed potential challenges, including the shift to WTO trade rules, which could lead to tariff impacts and loss of authorization for services, especially financial ones, in the EU. Logistical issues, such as airline and customs challenges, are also considered. The discussion extends to the crystallization of cross-cutting issues like derivatives, leading to risk premiums in markets. The video concludes with an assessment of these factors within the stress test framework, providing an outer boundary for potential losses.

What is one of the initial challenges the committee considered if no agreement is reached?

• Adopting new environmental policies

• Moving to WTO trade rules

• Expanding international alliances

• Increasing domestic production

Which sector is notably affected by the potential loss of authorization for services?

• Agriculture

• Financial services

• Manufacturing

• Tourism

What kind of challenges are considered beyond just tariff impacts?

• Cultural challenges

• Educational challenges

• Logistical challenges

• Technological challenges

What happens in markets when risk premiums crystallize?

• Risk premiums have no effect on markets

• Risk premiums lead to increased market volatility

• Market volatility decreases

• Market stability increases

What is the overall boundary used for assessing the scenarios discussed?

• The economic growth rate

• The employment rate

• The stress test envelope

• The inflation rate