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Osborne: ‘Mortgage rates will go up if we leave EU’

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Chancellor George Osborne has reportedly warned that mortgage rates would go up if the UK decided to leave the European Union.

Speaking to the BBC in Washington, where he was attending the International Monetary Fund’s half-yearly meeting of finance officials, Osborne said a Brexit would cause “instability” in financial markets.

He added: “The Bank of England is independent and it makes its decisions on interest rates. But the overwhelming view of the experts here in Washington is that if Britain leaves the EU, prices would go up and there would be instability in financial markets.

“That means it’s likely that mortgage rates would go up, families would pay the price of Britain leaving the EU.”

The Chancellor argues that sterling would slump if the UK voted to leave the EU, which would push up the cost of imports. That would lead to rising prices and therefore the Monetary Policy Committee would have to act to battle inflation.

However, Vote Leave, the official campaign of the Leave vote, hit back at the suggestions.

The campaign’s chief executive, Matthew Elliot, said: “Less than 24 hours [into the official 10-week referendum campaign] and the pro-EU camp are already panicking – resorting to doing down the economy and people’s mortgages to intimidate the British public into voting their way.”

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  • Chris Hulme 18th April 2016 at 5:31 pm

    There isn’t any real evidence from either camp backing up their claims of a good life or worse life – it is all propaganda seemingly without any verifiable merit. The vote could be won or lost on heresay…..

  • Stuart Duncan 18th April 2016 at 1:11 pm

    I am ambivalent about leaving/staying but tend towards staying as I don’t like much of the jingoism expressed by Brexit proponents. As with the Scottish referendum, though, I object to waves of propaganda and, in some cases, disinformation being sprayed around. As John Lacey says,itmay backfire because voters do not like being intimidated in this way.

  • John Lacy 18th April 2016 at 10:51 am

    I think that these scare tactics may well back-fire on the Remain supporters—as most of the lenders source their funds within the UK there seems to be no substance to these pronouncements