Speculation is mounting that central banks including the Bank of England, Bank of Japan and US Federal Reserve are readying emergency support measures to fight the market fall-out which the result of the polls could unleash.
G20 officials said central banks were ready to step in if needed to stabilise financial markets after the vote. Canada is “ready to act” if the situation takes a serious turn for the worse or there is “an external shock”, a spokesman for its prime minister said.
The head of the European Central Bank, Mario Draghi, also fuelled speculation of looming action, as he indicated inflation was not a threat which would prevent a move.
“There are serious downside risks here,” he said. “This risk has to do mostly with the heightened uncertainty.”
In the UK, the Chancellor has announced £140bn emergency funds will be funnelled to banks via the Bank of England to avoid another credit crunch against the backdrop of the eurozone crisis. The prospect of more action boosted the UK’s benchmark FTSE 100 index on Friday, which closed up 0.22pc at 5,478.81 points.
Read more at the UK Telegraph HERE.