Friday 19 July 2019 3:56 pm

Government launches review into Britain's financial rules ahead of Brexit

The City’s financial rules are set to be reviewed by the government ahead of Britain’s departure from the EU.

While there are no plans to change the format of the current financial watchdogs, the government has launched a review into how regulation within the financial sector could be changed post-Brexit.

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In a statement today financial services minister John Glen said: “It is now right that we step back to look at how the system is working more widely, and what changes may be needed in the future to adapt to the UK’s new position outside of the EU.”

Speculation has mounted over how the current rules governing London’s financial sector will change when Britain leaves the EU, which has been the source of much of the regulation.

But regarding financial watchdogs, the government has said it believes the institutional arrangements “provide the most effective way of ensuring clear and robust regulatory focus”, adding that “it does not expect to examine these arrangements as part of the Future Regulatory Framework review.”

The comments come as economists are forecasting that Britain’s chances of leaving the EU without a deal is at its most likely since October 2017, according to a Reuters poll.

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As expectations mount that Boris Johnson is likely to become the next Prime Minister, a median forecast of 30 per cent of financial experts are predicting Britain and the EU will not agree terms by a deadline of 31 October, rising from 25 per cent in June and 15 per cent in May.

Yesterday an influential group of MPs also called on the Bank of England and the Treasury to update Parliament on the economic impact of different Brexit scenarios, including a no-deal.

Nicky Morgan, who heads up the Treasury Select Committee in Parliament, has asked Bank of England governor Mark Carney and Treasury permanent secretary Sir Tom Scholar to submit up-to-date findings on how Britain’s departure from the EU could affect the economy.