EU referendum: Mark Carney tells Treasury Select Committee Bank of England will stay neutral over Brexit

Carney said that there would be likely be "issues with financial stability" if the UK voted to leave the EU

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The Independent Online

Mark Carney, the Governor of the Bank of England, has been accused of damaging his institution's reputation by the Treasury Select Committee.

Carney appeared in front of the Committee to answer questions on the Bank of England's position on the EU referendum.

At the start of the meeting he confirmed to committee members that the Bank of England would not be giving a view on whether the UK should remain part of the EU in the referendum on June 23.

"We will not be making, and nothing we say should be interpreted as, any statement on the UK’s membership of the European Union," Carney said.

But he was quickly accused of toeing a pro-EU line by Tory MP Jacob Rees-Mogg, who said that he was being "speculative" and acting "beneath the dignity" of the Bank of England by pushing a pro-EU agenda.

"I will not let that stand," Carney replied.

During the debate, Mark Carney said that the EU had a positive effect on the economy at two points: when Britain joined the EEC and when the single market was created.

Carney said that the language used in the Bank of England's 19-page to the Treasury committee was "careful" and not "conclusive". That letter is available to read in full here.

Carney later said that there would be likely be "issues with financial stability" if the UK voted to leave the EU.

"We will do everything we can in our power to ensure financial stability. In terms of shorter term instabilities that might arrive, we can mitigate that. We can take actions to get inflation back to target," he said.

"But that’s not to say there would not be issues in the short term with financial stability. And that reduction in financial stability would be associated with poor economic outcomes as we have seen in the past."