UK economy: Political vulnerability, uncertainty and Brexit - Westpac

The key issue facing UK is the impact of Brexit as negotiations begin in earnest and investment decisions have to be made, feels the research team at Westpac.

Key Quotes

“May’s government is prone to internal dispute and struggling to ensure its majority. It bargaining stance with EU is compromised.”

“Demands for UK to pay its EU liabilities, whilst questioning its EU assets, provide a difficult start to negotiations given unclear UK stance.”

“Softer CPI should quell debate between BoE’s MPC members. Dep Gov Broadbent also focussed attention on Brexit headwinds.”

“Three indicators of household balance sheets constriction eased slightly but are still showing consumer difficulties.”

“Indicators from the BoE agents’ report are stable, but independent surveys of both consumers and business are faltering (as are PMIs).”