As an upbeat consumer and active investor in the United Kingdom, I am concerned about Britain’s current economic performance and the outlook for the UK.
I hear reports from the British government of prosperity despite Brexit, but then there are international economists and analysts that sometimes offer a sobering, conflicting view. Who are investors to believe? Are we being lied to and intentionally mislead by officials in the United Kingdom?
It was expected that the Brexit decision would have some adverse effect on the UK economy. Let’s face it, that was irrefutable. So, as predicted, growth has slowed and inflation has risen across the country. In fact, according to a new analysis, Brexit has already inflicted damage totaling nearly £20 billion on Britain’s economy. This is equivalent to approximately £300 million a week since the referendum in June of 2016.
In Q3 of 2017, the UK’s annual rate of GDP growth fell to a disappointing 1.5 percent. This was the country’s weakest performance since 2013. Adding to the disappointment, the figure is a downgrade from the upbeat 2 percent growth that officials at the UK’s Office for Budget Responsibility estimated in the Spring of 2017.
In my mind, as an investor and consumer in the United Kingdom, here is a review of what has transpired. Since the vote to leave the European Union, there has been a sharp drop in the value of sterling. This has meant that imports have become more expensive for residents of the UK, like me. It has also meant that inflation has risen well above the Bank of England’s target. Is all of this to be expected?
The distribution of misinformation, whether by government officials or analysts, makes it difficult for investors to make investment decisions. What we all need is clear, unbiased information that we can plan our future on and make confident, long-term investments in the United Kingdom.