All signs now point to recessionary forces coming into play in the British economy. Consumer spending has slowed, as the pound’s drop is being passed through prices to consumers. The effects of sticky prices are very apparent across the UK economy, from wine importers announcing price hikes, to a highly publicized rift between Tesco (a […]
Weak Sterling and Economic Growth
Recent figures appear give the UK fairly healthy GDP growth projections for this year relative to other OECD members. While this has been interpreted by Brexit apologists as a sign of prosperity to come, such an interpretation is gravely mistaken. Britain’s current ‘growth’ comes down to two things: the basic math behind growth accounting and […]
Investment and the Bank of England
While the Bank of England elected to maintain the 0.25% base interest rate, there’s been consistent speculation over a rate cut from the Bank of England (BoE) – from 0.25% to 0.10%. This comes in light of a lot of doubts over central bankers’ dwindling powers, particularly in the face of some of the more […]
Post-Brexit Trade
The French president, Francois Hollande, has reiterated what I expect to be a standard line among EU leaders: no common market without free movement, which stands in stark contrast with the Leave campaign’s pipe dream of full common-market access and no movement. Intuitively, the solution to this bargaining game will lie somewhere between these two […]
Brexit, two weeks out
As expected, the last two weeks following the UK’s EU referendum have been marked by significant political and economic volatility. Both major English political parties are in a state of upheaval: within Labour, Jeremy Corbyn dramatically lost a vote of confidence, yet refuses to resign (it recently appeared that he would retain popular support in […]
Quick Thoughts on Brexit
My colleague Alan Renwick has a nice post covering the legal logistics surrounding Brexit. What about the economic implications? The domestic economic implications of Brexit began to play out while votes were still being tallied, as the British pound dropped rapidly in a depreciation reminiscent of Black Friday, eventually settling at a level not seen […]