The International Monetary Fund warns that Brexit is hurting UK growth, and things could get a lot worse…
- Lagarde: No-deal Brexit would hurt growth and weaken the pound
- BREAKING: UK faces massive Brexit workload, says IMF
- IMF: UK would be weaker under any Brexit deal
- Hammond: We need to heed IMF’s warning
Just in, growth in New York’s factory sector has slowed this month.
The Empire manufacturing index of business conditions has dropped to 19 this month, sharply down on August’s 25.6. Firms reported a slowdown in new orders, and a rise in costs — perhaps a sign that the trade war is hurting.
US empire manufacturing for September 19.0 vs 23.0 expected https://t.co/U0BRf8jgnx pic.twitter.com/Tj6tZtrN8j
The IMF have now uploaded Christine Lagarde’s opening statement at today’s Article Four press conference on the UK economy.
Here’s the key section, on Brexit:
For the UK, we are projecting growth of about 1½ percent this year and next , down from about 1¾ percent in 2016 and 2017. As we noted last year, Brexit-related effects are the driving factor for the slowdown in growth since the referendum. This has occurred despite strong policy frameworks and implementation. Uncertainty about the future economic environment has weighed on investment, despite still robust global growth and easy financing conditions, while the post-referendum depreciation of sterling has depressed real income growth and consumption. While exports have picked up thanks to the weaker currency, they have not done so by enough to prevent an overall slowing of growth. Despite the more modest growth, however, employment continues to reach record levels, and the unemployment rate is near historic lows.
Our projections assume a timely agreement with the EU on a broad free trade pact and a relatively smooth Brexit process after that. A more disruptive departure will have a much worse outcome. Let me be clear: compared with today’s smooth single market, all the likely Brexit scenarios will have costs for the UK economy , and to a lesser extent for the EU, as well. The larger the impediments to trade in the new relationship, the costlier it will be. This should be obvious, but it seems that sometimes it is not.
Managing Director Christine Lagarde’s opening remarks at the press conference for the UK Article 4 consultation in London today https://t.co/w4Li068xLb pic.twitter.com/3Z7jC6atCU