Brexit: Five things we learnt from Mark Carney and the Bank of England
On the economy:
He called the deal reached by David Cameron in Brussels an "important commitment".
Sir Jon Cunliffe, the Bank's deputy governor for financial stability, said the renegotiation of Britain's relationship with the EU was "very important", "significant" and "material", and secured "quite powerful" safeguards for the UK.
But Mr Carney insisted the Bank would not take a position on whether Britain should stay in the 28-member bloc.
Here's a quick look at what Mr Carney and Sir Jon had to say about Brexit.
Mr Carney stressed that, in the long term, the Bank of England had the tools to deliver financial stability, whether Britain was in the EU or not.
However, he said the short term, the impact of a Brexit could "bring some challenges to financial stability".
On the one hand, a sharp fall in the pound could push inflation up sharply. On the other, falling confidence could drag down growth. This would put the Bank in a dilemma.
Does it raise rates to keep a lid on inflation, but risk hurting growth? Or cut rates to boost activity, which could potentially stoke price rises?
Mr Carney said: "The Bank would have to take an assessment of those forces and their likely persistence in terms of managing monetary policy to the achieve the inflation target."
If Britain left the EU and policymakers could not secure the same business conditions for the City that it enjoys today, it would "without question" hit UK jobs and growth, Mr Carney said.
This relationship would depend on the "degree of mutual recognition" that would be afforded to UK. For example, would the City be able to hold on the "passporting rights" that allows companies to do cross-border business in any country in the European Economic Area - i.e. the EU plus Norway, Iceland and Liechtenstein?
If the UK were relegated to "third country" status, or a relationship that was not as strong as today's, Mr Carney said companies would probably "take a view in terms of relocation".
He told the Commons Treasury committee: "One would expect some activity to move, certainly there's a logic to that, and there are some views that have been expressed publicly and privately by a number of institutions. A number of major institutions [that have their European headquarters here] are contingency planning for that possibility."
Conservative MP Chris Philp asked Mr Carney if anything less than "mutual recognition" would result in "some degree of loss of business in the City of London. Mr Carney's response? "Without question."
While the Governor did not name any banks that were considering leaving the UK, Deutsche Bank has already said it may leave Britain if the country exits the EU.
And where would they go? "In terms of relative locations, they include Ireland or jurisdictions on the continent and there are a balance of factors which would drive it," Mr Carney said.
Mr Carney was also asked what the probability was that the City would get a good deal. He said:
"Mutual recognition arrangements are possible to achieve but in general they take a very long time and the challenge is the degree of freedom one retains in setting one's own path of rules and maintaining that mutual recognition."
In other words, if the goal of a Brexit is to wrestle back sovereignty from Brussels, it's unlikely Britain could do this and enjoy the same deal as it does now.
Sir Jon added: "I would think that once we are outside of the European Union, and if we wanted to remain in the single market for financial services, it would be a very big negotiating ask to also have the influence on setting the rules that we have at the moment.
"So when you see how the EFTA (European Free Trade Association) counties participate - the Swiss and others in the rule setting - they're consulted but they don't have a say. It's theoretically possible that a say could be negotiated, as I say we're in unprecedented territory, but to me it's not likely that we would be able to stay in the single market and have the influence on setting the rules that we have as a member of the European Union, if we were outside the EU."
Sir Jon poured cold water on the prospect of swift trade deals with Britain's most important partners.
He described trade negotiations as "slow moving" and said they often took a "number of years" to complete. He used the example of the EU's agreement with Canada, which is currently in its eighth year.
Sir Jon said it was "not unreasonable" to think that some trade agreements could take "longer than five years" to hammer out.
"The capacity for trade negotiations is pretty full, so those agreements may take some time," said Sir Jon.
Mr Carney said it was also likely that foreign direct investment would suffer. "It's hard to argue the converse," said Mr Carney.
There has been some discussion about whether David Cameron's deal with Brussels is legal.
The agreement was reached on an intergovernmental basis. This means it was done outside the EU treaty framework.
Sir Jon said he believed the agreement was "binding".
He told MPs: "I don't think the European Court of Justice (ECJ) can or would ignore this international law decision."
Mr Philp asked him if the agreement was irrevocable.
"Yes, as an international law decision it binds the member states of the EU, and it's irrevocable in that it requires unanimity to abrogate therefore it can't be changed without the agreement of all."
The Bank of England announced this week that it was ready to pump billions of pounds of extra cash into the financial system if markets seized up in the weeks around the EU referendum in June.
Sir Jon said the decision to announce the move well ahead of the vote was taken to limit the downside risks. Such a move too close to the referendum risked triggering volatility in itself, he said.
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