The outcome of the UK’s referendum on EU membership could have consequences for both global financial markets and the US economy, according to US Federal Reserve policymakers.
In the minutes of the last meeting of the US Federal Open Market Committee (FOMC) on June 14-15, members agreed to leave interest rates unchanged, partly driven by the uncertainty ahead of the UK referendum that was held a week later.
Committee members stated at the time “it would be prudent to wait for the outcome of the upcoming referendum in the United Kingdom on membership in the European Union in order to assess the consequences of the vote for global financial market conditions and the US economic outlook”.
It added the result of the referendum “could generate financial market turbulence that could adversely affect domestic economic performance”.
The FOMC therefore agreed to leave policy unchanged, emphasising that any future action would be data dependent, with some members acknowledging their economic projections and forecasts were “now consistent with a shallower path than they had expected at the time of the March meeting”.
The next meeting of the committee will be July 26-27 2016.
