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Ashoka Mody

Stop Being So Gloomy About Brexit

The Bank of England should bolster confidence by holding back on stimulus.
Come on, get happy.

Come on, get happy.

Photographer: Chris Ratcliffe/Bloomberg

Few have been more downbeat about the outlook for the U.K. economy than the country's own central bank governor, Mark Carney. If he wants to help mitigate the consequences of the vote to leave the European Union, he should send a more encouraging message by holding back on monetary stimulus.

People charged with managing economies usually try to be optimistic, on the logic that their positive attitude will give people and businesses the confidence to spend and invest, ultimately making the optimism self-fulfilling. The rhetoric surrounding Britain's vote on EU membership has been a glaring exception. In a bid to influence the vote, a chorus of global policymakers predicted dire consequences. That chorus has sadly persisted.