Weak demand, slow GDP growth, intense inflation - is the future of the British economy after BREXIT. The signals that the worst is ahead, already designated- on materials AMarkets.
According to the National Institute of Economic and Social Research in July, Britain's GDP shrank by 0.2%. Bank of England in August downgraded its forecast to a minimum. So far, the changes in the UK economy is not particularly striking. However, many experts believe that further deterioration will occur at a remarkable pace.
The first blow will fall under the consumer price (inflation rise in a falling pound), the labor market and the financial sector. In the short term the pound will weaken (in the medium term - 15-20% - the forecast Goldman Sachs), pushing the price level to the Bank of England's target rate of 2%. I have noticed a sharp rise in prices for cars, phones, since British companies pay more for imported goods. An estimated Pantheon Macroeconomics, UK CPI will be 2.6% in 2017 and grow by 3.5% in 2016.
Weak labor market and rising prices - a dangerous combination, have a negative impact on domestic consumption. So far, the consumption is not severely affected, however. According to the report the British Retail Consortium, retail sales rose to a 5-month high in July. But the worst is ahead. According to forecasts from the Treasury last month, the country's trade deficit in the period April 2016-March 2018 will be 129 billion pounds.This is a third greater the earlier the March forecast. It is important to understand that BREXIT not an event. It is a process. And its impact on the economy will be long, dynamic.