Christine Lagarde [Source: Reuters]

Further uncertainty over Brexit will hinder growth in the UK economy, the head of IMF has told the BBC.

Speaking ahead of the agreement of an extension to Article 50, Christine Lagarde warned that businesses and investors will remain hesitant in the coming months.

She said any prolonged uncertainty would have a “negative impact”.

Ms Lagarde, a former French finance minister, said she hoped a deal could be struck quickly.

Speaking at the World Bank and IMF Spring Meetings in Washington, Ms Lagarde said: “If there was a prolonged uncertainty, we can suspect that the impact on confidence would continue because, you know, whether you’re talking about investors, whether you’re talking about decisions as to where to expand where to set up how to organize a supply chain, people are going to wonder, you know, what comes next and and how will it settle?

“So it would have a negative impact, no question about it. ”

Ms Lagarde also expressed sympathy with the plight of British businesses.

She highlighted that even with the contingency plans in place, they would face disruption in the event of a no-deal Brexit and may have to be resigned to taking a hit to their balance sheets and possibly market share.