Brexit Impact on the UK Economy

Brexit is Already Impacting the UK Economy:

what will Brexit mean for the British Economy?

Executives, forecasters and bankers have been trying to answer that question for at least two years. The U.K. government has done its own analysis,and a  leaked draft Tuesday makes for ugly reading

BuzzFeed reported that the government analysis suggest Brexit will reduced economic growth by between 2% and 8% over 15 years 

"this  was initial work not approved by minister, which only consider off-the shelf scenarios. No analysis was made of the bespoke arrangement we seek as a matter of government policy," a spokesman for prime minister Theresa May told reporters.

but never mind the future, there already plenty of evidence that the June 2016 vote by Britain to leave the European Union_ by far its biggest export market__ is already causing damage. And that 's with at least a year of fraught negotiations on the uncertain relationship between the U.K. and EU still to come.

Inflation surges ahead

inflation has risen since the Brexit vote as the pound's sharp drop_ it has fallen 9.5% since 23 june 2016, despite a recent recovery__ makes important to the UK more expensive. Last month, the squeeze on living standards worsened due to the increased cost of importing fuel, clothes and food, Pushing inflation up to 2.9%, from 2.6%  in July. The Bank of  England now estimates the consumer price index will peak above 3% in October. Mark Carney, the Bank's governor,also used a speech in Washington to argue that a sharp reduction in migrant labor to Britain after the EU referendum has the potential to cause a spike in inflation. That 's pushing the setter at Thread needle street to consider raising interset rates as soon as November. 

UK’s trade performance worsens outside EU

there has been some evidence since the vote of a boost to exports from the weaker pound, raising hopes that a stronger trade performance can offset a downturn in consumer spending. But the latest official trade figures show efforts to expand trade in good beyond the EU's border took a knock in july overall the UK deficit for goods and services remained unchanged at 2.9bn between June and July, beating economist's expectations for it to widen to 3.025bn.

Growth in key services sector sputters

Key barometer of companies' sentiment about business activity were disappointing in August, barring the manufacturing sector, which stands to benefit from the drop in the value of the pound making goods more attractive overseas. The UK's biggest sector, service, missed expectations amid uncertainly over the Brexit talks, as the Markit/CIPS  purchasing managers' index (PMI) came in at 53.2 in August down from 53.8 in July, signalling the slowest pace of business expansion in 11 months. While construction also missed expectations, the August manufacturing PMI beat economists' forecasts. The PMI measure are tracked for early clues on official GDP figures. 

House price growth data mask London decline

The latest monthly snapshot from the Royal institution of Chartered Surveyors showed house price growth improved in August from a month ago, although disguised was a drop in central London prices at the sharpest pace since 2008. A net balance of 6% of surveyors saw house prices increase rather than decrease, up from 1% in July, which was the lowest reading in four years. Sales weakness was north. Meanwhile healthy sales growth was reported in Northern Ireland, the south-west and Scotland.