The Bank of England escalated its warnings about the fallout from a British vote to leave the European Union next week, saying it could harm the global economy and sterling looked increasingly likely to fall further after an "Out" decision.
The BoE's monetary policymakers also discussed the Bank's contingency plans to protect the banking system in the event of an "Out" vote, including closer supervision of banks to make sure they have access to the liquidity they need.
They said the referendum was the largest immediate risk facing British financial markets, repeating previous language about the vote but this time they said markets and economies around the world could be at risk too.
"Through financial market and confidence channels, there are also risks of adverse spill-overs to the global economy," minutes of the June 15 meeting of the Bank's Monetary Policy Committee said.
Billions of dollars have been wiped off global stock markets in the run-up to the June 23 referendum and yields on government bonds in several countries have hit record lows.
A decision to withdraw from the political bloc "appears increasingly likely... [to mean] sterling's exchange rate would fall further, perhaps sharply", the Bank's monetary policy committee (MPC), which decides on interest rates, said.
In the minutes of its latest meeting, at which the MPC decided to leave interest rates at their record lows of 0.5pc, the committee also cautioned that there was "growing evidence that uncertainty about the referendum is leading to delays to major economic decisions that are costly to reverse".
Bank officials said that this could include the postponement of "commercial and residential real estate transactions, car purchases, and business investment".
Japan keeps economy assessment unchanged, warns of slower consumer price rises
Japan's government kept its assessment of the economy unchanged this month but warned that consumer prices are rising at a slower pace, casting more doubt on policymakers' three-year effort to shake off deflation.
"Japan's consumer prices are rising at a slower pace," the Cabinet Office said in its monthly economic report on Friday, while maintaining that the economy remains in a "moderate" recovery.
Oil Prices Pare Losses; Brexit Weighs on Commodities
Influential analysts at Goldman Sachs have returned to taking a more negative view on the oil price, warning it could fail to return to recent 2016 highs "for months".
The bank's brokers made headlines with their suggestions last year that oil could slump to a "cost price" of around $20 a barrel. In early February, international benchmark Brent crude crashed to $27, a near 13-year low.
Since then, trading has enjoyed a recovery that peaked at $53 a barrel last week, the highest for eight months, before embarking on a five-session slide.
Reference: NASDAQ.The Week,Reuters,Telegraph, Bloomberg
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