LONDON — The U.K. financial system is prepared to cope with a no-deal Brexit, though uncertainties about the country’s withdrawal from the European Union are weighing hard on the wider economy, the Bank of England said Wednesday.
The bank’s Financial Policy Committee, which assesses financial risks, said legislation, temporary permissions and other preparations by British authorities have been made to “ensure that households and businesses will be able to use existing and new services from EU financial institutions.” The wider economy, however, is feeling the strain.
“Entrenched Brexit uncertainties, particularly in an environment of weaker global growth, continue to weigh on economic activity in the U.K.,” it said. “Brexit uncertainty is weighing on business investment, the prices of U.K. assets and flows of foreign capital into the U.K.”
It highlighted commercial property as one sector that’s struggling as global investors become more cautious.