No deal Brexit impact on UK economy ‘dwarfed’ by coronavirus says Bank of England Governor

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Andrew Bailey, Governor of the Bank of England, explained the impact of a no deal Brexit has been dwarfed by the effects of the coronavirus pandemic on the economy. He said while both can affect trade, the bank’s research has shown that COVID-19 is a much bigger shock to the economy. Speaking to Sky News, Mr Bailey said: “It is very complicated at the moment, both COVID and Brexit could both negatively affect trade.

“All our work suggest COVID is a bigger shock moreover, of course, COVID has already had an effect on trade.

“You then get to the extremely complicated question, how much of that effect on trade has actually already been taken over by COVID.”

His comments come as Brexiteer and Conservative MP Mark Francois recently warned the EU’s chief negotiator Michel Barnier that the British public is growing impatient following years of Brexit negotiations.

Mr Francois hit out at Mr Barnier who said last week a Brexit deal looked “unlikely” and that the two sides remained at a stalemate.

The Brexiteer warned the UK could leave with no deal on December 31 as Prime Minister Boris Johnson has refused to request an extension to the trade talks.

David Frost, the UK’s chief negotiator, meanwhile confirmed there was a continued impasse but struck a more hopeful tone in his media appearance following intensified discussions.

Speaking to talkRADIO, Mr Francois said: “One thing that runs through history is, people who bully us tend not to do well out of it.

“That isn’t going to work and if necessary we will leave on December 31 and we will trade on Australia/WTO terms which is how most of the world trades anyway.

“We’re not frightened of doing that. We would prefer a deal but if they’re going to be intransigent we’re going down the WTO path.

“I think the British public is running out of patience with Mr Barnier. The show is getting a bit boring.

“If they don’t want a compromise that’s fine, we’ll do our own thing.”

Brexit talks will intensify over the summer between the UK and EU, according to Government sources.


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A senior UK Government official involved in the talks said the “only way forward now is to have a textual negotiation to get into the detail”, which is scheduled to happen in August and September.

Formal talks are “pre-programmed in” for the week of August 17 and fringe discussions will continue next week.

A senior UK Government official involved in the talks, when asked about whether the discussions were closer to breakdown or breakthrough, said: “I think we are potentially closer to both, to be honest – I think it is hard to quantify.

“I can quite see how we can make a breakthrough relatively quickly if they do adjust their position in the most important areas and, if they don’t, we won’t.

“It really is in their hands to a large extent and it is related to the fundamental principles in these few areas.”

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