What has happened to UK’s economy after months since Brexit was voted a yes?
Overall, the economy is showing to be resilient following June’ Brexit vote. Financial data company Markit have published a survey which forecasted a GDP expansion of 0.1% in the third quarter. The Markit/CIPS purchasing managers’ index for August rose to 52.9 after slumping to 47.4 for July following the vote to leave the EU. That was the biggest month-to-month jump in the survey’s 20-year history and followed the biggest drop on record the previous month when businesses were coming to terms with the outcome of referendum.
Let’s look at some of UK’s sectors.
It was reported recently that the construction and export figures in UK has seen to be growing and confidence is building up in UK service sector while manufacturing sector has shown activities of picking up in August. However, there are falls in commercial property and house sales.
The retail sales appears to be better in August. British Retail Consortium (BRC) and industry analysts Nielsen showed a 1.1% fall in food prices in August with a drop in cost of non-food items by 2.5% over the month.
We ought to be careful when reading such good figures as these are short term figures. Head of economics at the British Chambers of Commerce, said the UK’s near-term trade prospects would continue to be largely determined by how much the benefits of lower sterling for exporters are offset by higher input costs. On top of that, there is another hint on cutting the interest rates lower.