Central Banks may not not have an answer for Brexit and its fallout

Central banks had become the all-powerful panacea for the global economy’s problems in recent years.

But this time, it appears they might not have an answer — or an audience — following Brexit and its fallout.

It’s a key shift. Since the global financial crisis, central banks have led the rescue effort for nearly every major economic or financial shocker. From extra low interest rates to buying bonds to communicating super sensitive information in a timely manner — central banks have pulled out all the stops. And global investors have held on to their every word.

Leading up to Brexit, central bankers, including Federal Reserve chair Janet Yellen, warned about economic risks if Britain decided to leave the EU.

But now that it has happened, central banks are just offering support to financial system and the leaders have kept mum about offering any solutions. Yellen even canceled an appearance at a panel discussion in Portugal Monday.

“This is a fundamentally more profound problem than central banks and monetary policy can handle,” says Tony Roth, chief investment officer of Wilmington Trust.

Roth argues that Brexit isn’t an economic problem right now, it’s a political one, and that central bankers shouldn’t be taking any drastic measures until the economy shows signs of weakness or cash dries up in markets.

Bank of England President Mark Carney, who warned prior to the vote that Brexit could cause a recession in the U.K., said Friday the BoE wouldn’t hesitate to take measures to ease markets.