Powell Excerpt: US Could See Small Impact From Brexit

     WASHINGTON (MN) - The following is a response of Federal Reserve Chairman

Jerome Powell to a question from a reporter at his press conference following

Wednesday's Federal Open Market Committee meeting.

Question: Among the global developments that the Fed is monitoring, how much of

a risk for the American expansion would be the prospect of a hard Brexit? 

Powell: We've been monitoring the Brexit situation very carefully for a long

time. And for us, that starts with US financial institutions that have a

presence either in the UK or in the EU or both. So we have worked with those

institutions along side UK and EU regulators to assure ourselves that those

firms have plans and have liquidity and all the things they will need to deal

with the full range of Brexit outcomes. So we've done a lot of work on that. And

generally speaking, again, a lot of work has been done, we have to be humble and

say that this is an unprecedented event.  But that's the financial system aspect

of it. 

     If there is a hard Brexit, then that would very likely involve disruptions

both to the continental economy and certainly to the UK economy. And we would

feel that. The question for us -- it wouldn't be a huge first order thing, the

economic effects, unless you saw financial (inaudible). If you saw financial

turmoil that would be the way it would reach us. 

     I would expect we would feel some of this.  It's very hard to have great

confidence that you know what that would be, but it would be something. Probably

not material to our economy, but something we'll be watching very carefully and

certainly hoping that there is a resolution short of a hard Brexit.

--MNI Washington Bureau; +1 (973) 494-2611; email: harrison.clarke@marketnews.com

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