But he did add that the economy is, however, likely to adjust and find balance again in the longer term.<\/p>\n
“Over the longer term, there will be – because trade adjusts – some at least partial rebalancing,” he added.<\/p>\n
Speaking at an international banking seminar on Saturday in Washington DC, Mr Bailey said: “For nearly a decade, I have been very careful to say that I take no position per se on Brexit, which was a decision by the people of the UK, and it is our job as public officials to implement it.<\/p>\n
“But, I quite often get asked a second question: what’s the impact on economic growth?<\/p>\n
“And as a public official, I have to answer that question.<\/p>\n
“And the answer is that for the foreseeable future it is negative.”<\/p>\n
![\"Former](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2025\/10\/skynews-boris-johnson-brexit_7015665.jpg\")
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Image:
\n Former Prime Minister Boris Johnson was a champion of Brexit. Pic: Reuters<\/p>\n
However, Mr Bailey did say investment in innovation and new technologies, including AI, may help address the decline in productivity growth in the long run.<\/p>\n
“If we take account of the impact of ageing and trade restrictions, we’re really putting our chips on investment,” he added.<\/p>\n
“We’re putting our chips on general-purpose technology, and AI looks like the next general-purpose technology, so we need to work with it.<\/p>\n
“We need to ensure that it develops appropriately and well.”<\/p>\n
Read more from Sky: Mr Bailey warned that, although AI is likely to usher in a breakthrough in productivity long-term, it may “in the current circumstances, be a risk to financial stability through stretched valuations in the markets”.<\/p>\n “It doesn’t undermine the fact that AI, in my view, is likely, in addressing this slower growth issue, that we have and the consequences of it – that it is actually the best hope we have, and we really do need to do all we can to foster it,” he said.<\/p>\n 2:20<\/p>\n Has Rachel Reeves changed her tone on budget?<\/p>\n The Bank of England governor’s prediction comes as Chancellor Rachel Reeves<\/a> is under pressure ahead of next month’s budget, with official figures showing muted growth in August following a surprise contraction in July.<\/p>\n Inflation surge<\/p>\n The Office for National Statistics (ONS) said gross domestic product (GDP) rose by 0.1% month-on-month in August and fell by 0.1% in July, in a revision to the previous estimate for no growth.<\/p>\n In the three months to August, GDP grew by 0.3% compared with 0.2% growth in the three months to July, the ONS said.<\/p>\n
You can’t win every investment, says chancellor<\/a>
Sidemen partner lands backing from Osborne-led firm<\/a><\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2025\/10\/skynews-rachel-reeves-chancellor_7052360.jpg\")
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