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EU demands Brexit clarity, cuts growth

Tuesday, July 12, 2016 - 01:47

The European Commission has revised down its forecasts for growth in the euro zone and in Britain after the British vote to leave the EU. As David Pollard reports, that's a worry for finance ministers meeting in Brussels.

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If all eyes are on a new leader for Britain, another of Europe's first ladies still commands the ears. And is uncompromising on the need for speed from the UK. (SOUNDBITE) (German) GERMAN CHANCELLOR, ANGELA MERKEL, SAYING: "The United Kingdom will have to clarify quickly how it wants to shape its future relationship with the European Union." A Brexit clock ticking down then - as could growth. The European Commission has sliced up to half a per cent off its EU outlook this year. Britain expected to lose anything up to two and half per cent. (SOUNDBITE) (English) EUROPEAN COMMISSIONER FOR ECONOMIC AND FINANCIAL AFFAIRS, PIERRE MOSCOVICI, SAYING: "The longer the uncertainty last, the costlier it will be for the economy ... With the arrival of Madame May by Wednesday, it is essential both for political and economic reasons, that we continue calling for a clarification of the situation as soon as possible." Though that is unlikely to come from the UK just yet. Britain will only trigger formal Brexit talks 'when it's ready' according to a close ally of the prime minister designate. (SOUNDBITE)(English) CIBC, HEAD OF FX STRATEGY, JEREMY STRETCH, SAYING: "There's a little bit of a stand-off diplomatically, which will be played out in public. In private, there will be perhaps be a little bit of negotiations, however soft at the margins, and I think that's going to be the interesting point ... There are domestic and political imperatives at play, because of course France and Germany go the polls next year and I think in the context of Europe both leaders would be far happier to go the electorate with some degree of resolution." EU leaders might not like the UK's 'wait and see' approach - but markets appear to. Sterling too - the pound and bond yields continuing to rise on Tuesday. And share markets continuing to get a boost on hopes of further monetary stimulus. Something Bank of England governor Mark Carney - appearing before before UK lawmakers - has again hinted is possible.

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EU demands Brexit clarity, cuts growth

Tuesday, July 12, 2016 - 01:47