16:09

Some good news: Mark Carney has said that Britain’s preparations for no-deal Brexit could help cushion the blow for the economy from leaving the EU without a deal.

While maintaining that crashing out without a deal would trigger a “material shock” for the economy, the Bank of England governor said that steps taken in recent months would help to “pull back” some of the impact on GDP.

Threadneedle Street had previously published details of a worst-case scenario for no-deal Brexit that included an immediate recession with GDP falling by as much as 8%.

However, Carney tells the House of Lords committee that as much as 3.5% of those losses could be contained by mitigating steps taken in recent months.



“My point being there has been progress in preparedness and that reduces the level of the economic shock.”

The Bank’s governor said there was “false precision” in the numbers he used, and added: “To be absolutely clear we still expect there would be a material economic shock.”

