I was reading this article, George Osborne says Brexit would drive up mortgage rates:
George Osborne has issued a stark warning that mortgage rates will rise if Britain leaves the European Union.
The chancellor said he thought it was likely interest rates, and therefore the cost of home loans, would rise if Britons vote to leave the EU in the referendum on 23 June. But Brexit campaigners accused Osborne of panicking and resorting to intimidating voters.
Asked if he thought the cost of mortgages would increase on a British exit from the 28-nation bloc, Osborne said: “The short answer is yes. I think that is likely, but I’m not in charge of interest rates.”
I was wondering what is the transmission mechanism for explaining why interest rates would have to go up if Brexit happens? Moreover, is there any historical example and precedent for this happening?