Monetary policies post-Brexit

On June 23, British citizens chose to terminate its membership of the European Union (EU). It is still early to assess the economic and financial impact, both in the United Kingdom and elsewhere, but this outcome plunges the economy and markets in considerable uncertainty. Central banks are at the bedside of the economy since the last crisis, and even before the Brexit, there was a perception that their capabilities had greatly diminished. However, given their inflation stabilization mandates, it is expected that some central banks will feel compelled to intervene further. This Economic Viewpoint takes stock of the state of play for the Bank of England (BoE), the European Central Bank (ECB), the Federal Reserve (Fed) and the Bank of Canada (BoC). We conclude with a reflection on policy mix implications.