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Euro Zone Weakness A Big Risk To Uk

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NSS

Britain's economy could be seriously hit by weakness in the euro zone, the country's biggest trading partner, Bank of England policymaker Adam Posen said in the script of an interview for broadcast Tuesday.

Posen said market jitters related to the EU-led rescue package for highly indebted euro zone countries were not surprising and reflected the reality that growth in much of the shared currency bloc would be very slow for several years.

"Sixty percent of our trade is with the euro area. So we view this as a very real risk," Posen told U.S. broadcaster National Public Radio, according to a script provided by the broadcaster.

"If the euro area goes down then that does have a huge impact on us," he said in the interview recorded Friday for NPR's Morning Edition show. Posen was asked about recent comments by former U.S. Federal Reserve Chairman Paul Volcker which cast doubt on the euro zone's future.

"Volcker's comments are looking at a worst-case scenario which I don't think is very likely, but you have to say it's certainly more likely now than it ever was at any point in the previous 11 years (that) the euro existed," Posen said.

NPR said Posen was untroubled by sterling's recent weakness.

"It's just good to keep some perspective that currencies go up, currencies go down. The fundamental thing about Europe is that the euro area is going to be growing slowly the next few years. That's the big news, and that's the sad part," Posen said.

The Bank has previously identified euro zone economic weakness and market worries about sovereign credit risk as a threat to British economic growth, most recently in last week's quarterly Inflation Report.

Few economists expect Bank interest rates to rise from their current record low of 0.5 percent before late this year at the earliest, despite inflation hitting a 17-month high of 3.7 percent last month..

If...well, when the EU as it exists today fails, utterly, will the UK hold the Labour government and their broken promise of a referenced to task?

We are chained at the ankle to this monetary behemoth across the channel after all.

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NSS

If...well, when the EU as it exists today fails, utterly, will the UK hold the Labour government and their broken promise of a referenced to task?

We are chained at the ankle to this monetary behemoth across the channel after all.

so if 60% of our trade is with the EU,then it is time to do what all good business do and diversify our portfolio.

If I were running a business I would NEVER allow one customer so much weighting.

not only does it feck you up when they go down,but if they have such a monopoly on your custom they can dictate punitive terms....if you have other options then they have to pay a better rate.

putting all eggs in one basket was and is never sensible.

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  • 259 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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