Chancellor of the Exchequer Philip Hammond said he’s ready to “reset” Britain’s fiscal policy if needed to respond to turbulence caused by the decision to vote to leave the European Union.
“In the short term, our colleagues at the Bank of England will be using the monetary tools at their disposal,” Hammond said in Beijing on Friday ahead of a meeting with fellow Group of 20 finance ministers in Chengdu, China. “Over the medium term, we will have the opportunity with our Autumn Statement, our regular late-year fiscal event, to reset fiscal policy if we deem it necessary to do so.”
Hammond’s comments came prior to publication of flash estimates of the impact of the Brexit vote on U.K. services and manufacturing, with the composite July Purchasing Managers’ Index falling to its lowest in seven years and shrinking at the fastest pace on record. The pound reversed a weekly gain, dropping 1 percent to $1.3102 at 12:35 p.m. London time.
