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Reuters Governor of the Bank of England Mark Carney delivers a speech at the annual Mansion House dinner in London, U.K., June 20, 2019.
Bank of England Governor Mark Carney is worried central banks don’t have enough tools to fight a sharp downturn.
“It’s generally true that there’s much less ammunition for all the major central banks than they previously had and I’m of the opinion that this situation will persist for some time.
The Bank of England’s base rate is 0.75%, and the U.K. central bank has also bought bonds, or engaged in quantitative easing, to boost the economy.
Carney, who’s due to be replaced by Andrew Bailey later this year, told the Financial Times that previous cuts from the U.S. Federal Reserve and European Central Bank were starting to flow to the global economy.
But a steep downturn may need more tools, Carney said.
Carney also told the FT that the U.K. should not align its financial regulation with the European Union in a post-Brexit trade deal the government is negotiating. He said it wasn’t “desirable at all” to align approaches and effectively outsource regulation and supervision.
