Wednesday, May 16, 2012

Euro Crisis: UK Plans For Currency 'Break-Up'



The governor of the Bank of England has delivered a scathing verdict on the handling of the eurozone debt crisis and confirmed contingency plans for a potential break-up of the single currency.

Sir Mervyn King, at the launch of the Bank's quarterly inflation report, admitted discussions were being held in the UK on how to handle the collapse of the euro.

The Bank, the Treasury and the Financial Services Authority are contemplating the worst-case scenario, which would send shockwaves around the world.

In the report, the Bank warned of continued risk of a "disorderly" outcome for the eurozone, as part of its wider forecasts for the UK economy.

Sir Mervyn admitted that the bank could not quantify the most extreme risks from the single currency area but declared that the UK's biggest trading partner was "tearing itself apart without any obvious solution."

He said "Just kicking the can down the road is not an answer." Read More