The Latest: Brexit uncertainty hurting growth – central bank

Manifestantes en contra del Brexit protestan en Londres, el lunes 19 de noviembre de 2018. (AP Foto/Kirsty Wigglesworth)

LONDON (AP) — The Latest on Britain’s exit from the European Union (all times local):

11:15 a.m.

Bank of England policymakers are warning that British businesses are increasingly concerned about the prospect of the country crashing out of the European Union in March with no deal on future relations.

The bank’s chief economist, Andy Haldane, told lawmakers that Brexit uncertainty is the “single largest headwind” to the British economy and that the impact has become “somewhat greater” in recent weeks amid talk of a no-deal Brexit.

As a result, he said, British economic growth is set to be “somewhat weaker” in the fourth quarter from the quarterly rate of 0.6 percent recorded in the third.

Michael Saunders, another rate-setter at the bank, said most businesses were nowhere near ready for a no-deal Brexit, which would see tariffs imposed on British exports and potentially big dislocations to supply chains as well as restrictions on the movement of people and goods.

Business confidence, he said, had risen recently and that would have “some negative effect” on near-term activity.


10:50 a.m.

A leader of a Conservative campaign to unseat Prime Minister Theresa May has acknowledged that the rebels don’t yet have the numbers for a leadership challenge.

Jacob Rees-Mogg is one of a group of pro-Brexit lawmakers who have written letters calling for a no-confidence vote in the prime minister. They say the divorce deal she has agreed with the European Union will leave Britain tied to the bloc’s rules without any say in making them.

The group said they were confident of getting the 48 letters — from 15 percent of Conservative lawmakers — needed to spark a leadership challenge.

Rees-Mogg said Tuesday that it remained to be seen whether the threshold would be reached.

He said that “patience is a virtue. …We shall see whether letters come in due time.”


10:45 a.m.

The Bank of England is to publish its assessment of Prime Minster Theresa May’s Brexit deal with the European Union next week in the run-up to a vote in Parliament.

It will also on Nov. 29 publish an assessment of what would happen to the British economy if the country crashes out of the EU without a deal and without a transition. Parliament’s Treasury Select Committee had asked for the findings to be published “in good time before any Parliamentary votes.”

However, Bank of England Governor Mark Carney said the bank won’t publish an assessment of Britain staying in the EU.

The assessment draws on a regular Financial Stability Report and stress tests into the country’s banks. The stability report and the stress tests are being brought forward to Nov. 28 from Dec. 5.

There is growing speculation that Parliament will vote, most likely in mid-December, against May’s withdrawal agreement given widespread opposition. If that happens, it’s unclear what would happen ahead of Britain’s scheduled departure in March 2019.


10:30 a.m.

Bank of England Governor Mark Carney has emphasized the importance of the transition period in Prime Minister Theresa May’s Brexit deal with the European Union.

Addressing lawmakers, Carney said he expects the withdrawal agreement to “support economic outcomes” as it would eliminate some uncertainty surrounding the British economy.

Part of the deal involves Britain following EU rules after Brexit day on March 29, 2019 through the end of 2020. However, there’s speculation that the transition could be extended and that would provide businesses more time to adapt to new relations with the EU.

May’s deal with the EU on how Britain leaves the EU has been met with widespread opposition within the British parliament, raising the prospect that it might be voted down. If it votes against it, Britain could crash out of the EU without a deal.

Carney said “we’re going to find out relatively soon” whether a no-deal Brexit has become more likely.


10:25 a.m.

Britain’s Supreme Court has rejected an attempt by the government to stop Europe’s top court deciding whether the U.K. can unilaterally halt Brexit.

The court declined Tuesday to grant the government an appeal to a lower court’s ruling that allowed the case to be heard by the European Court of Justice. Supreme Court judges say they do not have jurisdiction to hear the case because there has not yet been a final ruling.

The Luxembourg-based European court has a hearing set for Nov. 27.

A group of anti-Brexit politicians is seeking a ruling that Britain can halt the two-year countdown to Brexit that it triggered in March 2017.

The British government says it has no intention of reversing Brexit. But anti-Brexit campaigners hope Parliament may have the power to stop the country’s exit from the EU.


10:15 a.m.

Spain’s Prime Minister says his country will vote against the divorce agreement between the European Union and the United Kingdom if Gibraltar’s future isn’t considered a bilateral issue between Madrid and London.

The U.K. and the EU reached a 585-page draft withdrawal agreement and are fleshing out a far less detailed seven-page declaration on their future relations. Both need to be approved by European leaders at a weekend summit.

If the documents don’t change before Sunday, “Spain will vote no,” Pedro Sanchez has warned Tuesday during a business forum organized by The Economist in Madrid.

Spain is the only among 27 countries that has voiced opposition to the deal because it deems unclear the wording of how Gibraltar, the British territory at the southern tip of the Iberian Peninsula, would be dealt with.


10:00 a.m.

British Prime Minister Theresa May’s parliamentary allies are warning they could remove support from her minority government if she does not alter her Brexit deal with the European Union.

Northern Ireland’s Democratic Unionist Party struck a deal last year to back May’s Conservatives on major legislation. But the Protestant, pro-U.K. party opposes the Brexit deal’s plans for keeping the border between Northern Ireland and Ireland open after Brexit.

In a warning to May, DUP lawmakers abstained late Monday during several votes on finance bill, and voted against the government on one amendment.

DUP lawmaker Sammy Wilson said the votes were “designed to send a political message to the government.”

Writing in Tuesday’s Belfast Telegraph, May said the deal “puts Northern Ireland in a fantastic position for the future.”

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