Philipp Hildebrand Warns About Brexit

Philipp Hildebrand, Blackrock

Philipp Hildebrand, Blackrock

The opinion of former Swiss central bank president Philipp Hildebrand is sought after. And now he has got himself involved in the discussion about a possible exit of the United Kingdom from the European Union.

Blackrock, the world's largest wealth manager, doesn't usually try to influence political decisions, especially in jurisdictions outside the U.S. Philipp Hildebrand, the company's vice president still feels compelled to make an exception: in the foreword to a study published today, the former Swiss central bank boss cautions about the consequences of an exit of the United Kingdom from the European Union.

«A Brexit offers a lot of risk with little obvious reward,» Hildebrand writes. «We see an EU exit leading to lower U.K. growth and investment, and potentially higher unemployment and inflation.»

Brexit Will Hurt Markets

Voters in the U.K. in June will vote about the country's continued membership in the EU after Prime Minister David Cameron called a referendum he had promised would be held in last year's general elections. The vote will have to settle a conflict that has split the Conservatives for years and threatens to tear apart a government that only just won the elections in convincing fashion.

Hildebrand's warning to voters isn't entirely altruistic. «Global markets are already reeling from a deflationary scare driven by the oil price crash and a slowdown in China,» the study authors write. «An actual Brexit would hit global risk assets, we believe, whereas a vote to stay would reassure markets.»

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