- Carney, Lagarde, Osborne due to speak as decision day nears
- Bank of England will publish new forecasts on Thursday
Get ready for a pro-European Union onslaught.
This week, voters tuning into the fraught battle over the U.K.’s future will hear from heavy-hitters who have already warned about the risks of leaving the single market.
The chancellor of the exchequer, the governor of the Bank of England and the head of the International Monetary Fund are set to speak, while the National Institute of Economic and Social Research will share its view on the consequences of a Brexit. Prime Minister David Cameron kicked off the offensive on Monday with a speech focusing on how the EU helped foster peace in Europe.
As the nation’s referendum on its EU membership draws closer, Remain campaigners have put the economy at the heart of battle, arguing Britons would be less well off outside the bloc. With about 20 percent of voters still undecided and surveys showing uncertainty is already hampering growth, those arguments may be pivotal for the outcome.
“When all these economic figures come out and speak, it’s about the cumulative effect,” said YouGov’s director of political and social research Joe Twyman. “This is an argument that is being pushed repeatedly and seriously by the Stay campaign, because they know the economy is the most important issue for lots of people.”
The interventions have been coming thick and fast, with high-profile figures including U.S. President Barack Obama and Japan’s Prime Minister Shinzo Abe pressing the case for Remain, while Brexit campaigners saying such arguments are scaremongering. Donald Trump said immigration in Europe made him think Britons would be “better off” outside the bloc.
Cameron cited the EU’s role in building peace in a speech in London, and also said it’s made the U.K. economy stronger.
“The European Union has helped reconcile countries which were at each others’ throats for decades,” he said. “The evidence is clear. We will be better off in and poorer if we leave.”
The barrage has helped cloud the outlook for monetary policy and growth, intensifying the forecasting challenge for BOE officials. The central bank will publish new forecasts in its quarterly Inflation Report on Thursday, alongside its interest-rate decision and minutes of the May meeting.
While all economists in a Bloomberg survey forecast the key rate will be held at 0.5 percent, and the majority predict a unanimous vote, analysts at Bank of America Merrill Lynch say one or two of the nine-member panel could vote for a cut.
Even though officials say they’ll treat the data cautiously until after the June 23 referendum, a gauge of services, the biggest part of the economy, has since slumped to the lowest in more than three years. That may “test the patience of the doves,” according to Alan Clarke, an economist at Scotiabank.
Carney, who insists he’s neutral in the debate, has been criticized by some lawmakers for expressing views that they say back Remain. The governor, who is set to give a press conference on the economic outlook on Thursday, responded by saying it would be “political” of him to suppress the central bank’s risk analysis.
The Brexit campaign got some air time on Monday, when Boris Johnson said the vote is a choice between “getting dragged ever further into a federal superstate, or taking a stand now.”
“It is between taking back control of our money -- or giving a further 100 billion pounds to Brussels before the next election,” he said in a speech in London.
Vote Leave’s chief, Matthew Elliott, testifies to lawmakers on the economic and financial costs and benefits of membership later on Monday. Chancellor George Osborne, a Remain champion, speaks on the same topic two days later. He harnessed the economic arguments in an ITV interview on Sunday, saying Brexit would be “catastrophic for peoples’ jobs and their incomes and their livelihoods.”
The frenzy concludes on Friday, when IMF Managing Director Christine Lagarde speaks in London. The fund cut its U.K. growth forecast last month and warned of “severe” damage to the world economy if Britain leaves the EU.
“The Leave campaign is doing its best to muddy the waters surrounding the economic argument,” YouGov’s Twyman said. “They want to get to a stage where no one can be sure whether they’ll be better or worse off in or out. So all these people coming out for Remain helps to battle against that.”