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Don’t Mention the Brexit: EU Bans Plan B Studies

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European Commission economists have been banned from researching the impact of Britain leaving the 28-nation bloc, or even talking about it, for fear of getting embroiled in the heated British debate ahead of a referendum, officials said.

“There is an internal order not to discuss or study the impact of Brexit,” a senior Commission official told Reuters, adding that the instruction had come from the office of European Union chief executive Jean-Claude Juncker.

As a result, the Commission’s economic forecasts for the euro zone and the wider EU will take account of political and financial risks in China, the Middle East and the United States but not the glaringly obvious risk that Britain, the EU’s second biggest economy, may vote to leave.

Another senior EU official said the Commission had learned to its cost the consequences of such contingency planning last year. It insisted it had no “Plan B” to manage a possible Grexit — the risk of Greece leaving the euro zone.

Reuters

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Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
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