MW: Eurozone finance ministers warn of Brexit hitting growth
Eurozone finance ministers meeting in Brussels cautioned that prolonged uncertainty over the European Union’s future relationship with Britain posed a major economic and financial risk, as a top EU official warned the U.K.’s vote to leave could dent the bloc’s growth.
“The U.K. leave vote has surprised markets, and economic uncertainty has increased significantly since then,” said Pierre Moscovici, the EU’s economic affairs commissioner after the meeting on Monday. “The longer the uncertainty lasts, the costlier it will be for the economy.”
Although the U.K. isn’t in the eurozone, it hosts the EU’s largest financial center and is a major trading partner for many of the currency bloc’s members.
Moscovici said that preliminary analysis from the European Commission — the EU’s executive arm — indicated that the increased uncertainty following the British vote could reduce EU and eurozone growth by 0.2 to 0.5 percentage point by 2017.
The ministers’ gathering comes days after the International Monetary Fund also warned that the eurozone would grow at a slower pace in coming years because of political and economic uncertainty stemming from the Brexit vote.
