Brexit effect could be worse than forecast: Osborne

LONDON: British finance minister George Osborne said he believed that the hit to the country’s economy from a vote to leave the European Union on Thursday could

LONDON: British finance minister George Osborne said he believed that the hit to the country’s economy from a vote to leave the European Union on Thursday could be more severe than the most likely scenario forecast by the government.

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“The central estimate is that our GDP would be 5% to 6% smaller. Personally, I think it’s possible that it could be quite a lot worse than that,” Osborne said in an interview with ITV television on Sunday.

The finance ministry estimated in May that a vote to leave the EU would mean the economy would be 6% smaller within two years than if Britain voted to stay in, inflation would rise more sharply and house prices would be 18 percent lower.

“People are doing this already. They are not buying houses, they are not buying cars. They are delaying investment. This is before the vote. This is a taste of things to come,” Osborne said.

Meanwhile, the European Banking Authority will move from London to another European capital in case of Brexit, EBA head Andrea Enria told German newspaper Welt am Sonntag.