Brexit: Dire consequences if there's no deal

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By Louise Miner
Brexit: Dire consequences if there's no deal

With just six months to go until the UK leaves the EU the IMF's Christine Lagarde says she "very much hopes and prays that there will be a deal between the European Union and the UK.

She says a failure to get a deal will have dire economic consequences to the UK economy.

Christine Lagarde, Managing Director of International Monetary Fund says, "It will be a shock to supply it and it would inevitably have a series of consequences in terms of reduced growth going forward, increases deficit most likely, depreciation of the currency and, in reasonably short order mean a reduction of the size of the UK economy."

Speaking alongside Lagarde, the British finance minister Philip Hammond, says the government had to heed the "clear warnings" from the IMF of a no-deal Brexit.

British Finance Minister Philip Hammond says, "We must secure a close and enduring future partnership with our European neighbours and we must heed the clear warnings of the IMF and others of the significant cost that not reaching a deal with the EU will have for British jobs and British prosperity."

Last week, the Bank of England Governor, Mark Carney says a no-deal Brexit could be as catastrophic as the financial crisis a decade ago and Lagarde pointed out life will be more difficult for the UK.

Christine Lagarde says, "Any deal will not be as good as the smooth process under which goods, services, people and capital move around between the EU and the UK without other barriers, without impediments and particular obstacles. So whatever the deal is will not be as good as it is at the moment."

Meanwhile, Brexit supporters criticise the IMF for a series of doom and gloom forecasts of leaving the EU.