top of page

Brexit - The Grim Reaper


It may have taken some time to register for many people or indeed reflect on the economic data, but the vote for Brexit is now really reaping its toll on the UK economy.

The UK went from being the fastest growing G7 economy ahead of the vote to the slowest by the final quarter of 2017, with even Japan and Italy surpassing it. This trend continued in the opening quarter of 2018, with UK GDP rising by a paltry 0.1%, and the year-on-year growth rate slowing to 1.2%, the weakest since Q2 2012. This is at a time when the world economy has gained momentum, with the IMF forecasting global growth of close to 4% this year, compared to 3.2% back in 2016. There were hopes that bad weather had temporarily depressed UK growth in Q1 and the economy would regain momentum in April. However, PMI survey data have disappointed for the month, showing no meaningful rebound in activity, with the manufacturing index actually falling further. The April CBI Distributive Trades Survey was also disappointing. No wonder then, as discussed below, that a rate hike is no longer on the table at the upcoming MPC meeting.

Meanwhile, the agreement reached in March between the EU and UK on a post-Brexit transition period to last until end 2020, fuelled hopes of a soft Brexit when the UK leaves the EU next March. However, there is still very strong resistance by many in the UK Government to the idea of any form of customs partnership with the EU after the transition period ends. The deep divisions within the UK government also mean it will be a challenge to get an EU withdrawal agreement through Parliament.

The risk of a hard Brexit remains, and as the economic sentiment waxes and wanes, so do Prime Minister May's odds of survival.

See you next week!

To discuss how the above may affect you, please contact your Currency Dealer at Heritage Pay on +44 (0) 203 858 7274.


Featured Posts
Recent Posts
Archive
Search By Tags
Follow Us
  • Facebook Basic Square
  • Twitter Basic Square
  • Google+ Basic Square

+44(0)207 117 2934

128 City Rd, London, EC1V 2NX, United Kingdom

Heritage Pay Limited is registered in England and Wales - Company No. 11129859
©Heritage Pay Limited, 2018, All rights reserved..
For our terms, please visit: https://www.currencycloud.com/legal/terms/ 

For clients based in the European Economic Area, payment services for Heritage Pay Limited are provided by CurrencyCloud B.V.. Registered in the Netherlands No. 72186178. Registered Office: Nieuwezijds Voorburgwal 296 - 298, Mindspace Nieuwezijds Office 001 Amsterdam. CurrencyCloud B.V. is authorised by the DNB under the Wet op het financieel toezicht to carry out the business of an electronic-money institution (Relation Number: R142701).

For clients based in the United Kingdom and rest of the world, payment services for Heritage Pay Limited are provided by The Currency Cloud Limited. Registered in England and Wales No. 06323311. Registered Office: Stewardship Building 1st Floor, 12 Steward Street London E1 6FQ. The Currency Cloud Limited is authorised by the Financial Conduct Authority under the Electronic Money Regulations 2011 for the issuing of electronic money (FRN: 900199).

bottom of page