Brexit embarrassment for IMF as it admits market turmoil has 'ebbed' after doom-mongering
THE market "turbulence" triggered by the Brexit vote has already subsided, the International Monetary Fund (IMF) has been forced to admit.
IMF boss Christine Lagarde warned Britons about the economic impacts of Brexit
In the run-up to the EU referendum, the Fund issued a series of doom-laden warnings about tumbling growth if Britons voted to quit the bloc.
But now it has conceded the "short-term turbulence" in the financial markets has "ebbed" – a little over two months after the historic poll.
The admission represents an embarrassing climb-down for the IMF, which also admitted growth ahead of the vote "surprised on the upside".
Britain's economic outlook in the months ahead will by affected by the kind of deal Theresa May strikes with the EU, a new report by the Fund adds.
The IMF also forecast that measures taken by the Bank of England to boost growth would "support the economy" and "mitigate downside risks".
The pound jumped by as much as 1.35 per cent to $1.3318 against the dollar this morning following a boom by the UK manufacturing sector.
The Fund also admitted growth ahead of the referendum 'surprised on the upside'
The pound jumped by as much as 1.35 per cent against the dollar this morning
Manufacturing activity recorded its biggest month-on-month increase in 25 years in August, according to data by Markit.
The financial services firm said factories were returning to "business as usual" following a downturn in activity after the June 23 vote.
The news came ahead of the this weekend's G20 summit, where the Prime Minister will declare Britain is "open for business" around the world.
Manufacturing activity has recorded its biggest month-on-month increase in 25 years
May says there will be no second referendum on Brexit
Earlier this week the chief executive of Deutsche Bank said London will remain the financial hub of Europe regardless of Brexit.
John Cryan told a financial conference in Germany that although London's role will be "very different", its standing will not be affected.
Mr Cryan, who was a vocal Remain supporter, added: "We really need to follow our customers. In some areas London is our biggest trading hub."