Pound Slumps After Brexit Chief Admits Government Hasn’t Studied Economic Impact

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The pound extended declines against the U.S. dollar Wednesday after the country’s chief Brexit negotiator told a committee of lawmakers that the government hand’t yet published a detailed analysis of the economic impact of leaving the European Union.

Speaking at a hearing of the Exiting the European Union Committee, a group of U.K. lawmakers headed by Hilary Benn, Brexit Secretary David Davis said such an assessment would undermine Britain’s negotiating stance, adding he “wasn’t a fan of economic models that have been proven wrong”.

“The usefulness of a detailed impact assessment in near zero,” Davis said. “The assessment of (the effect of leaving the EU) is not as straightforward as people imagine. I am not a fan of economic models as they have all been proven wrong,” Davis told the committee. “When you have a paradigm change as in 2008, all the models are wrong. As we are dealing with here [with a] free trade agreement or a WTO outcome, it’s a paradigm change.”

The pound was marked 0.6% lower against the greenback at 1.3360 by mid-day in London, extending its decline past 2.4% from its late September peak.

His comments appear to contradict testimony he gave to the committee a year ago, when he said the the government was “in the midst of carrying out 57 sets of analyses, each of which has implications for individual parts of 85% of the economy.”

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