Brexit worries continue to weaken Sterling
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- August 20, 2018
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Worries about whether Britain can agree a trade deal with the European Union over coming months to avoid a sudden and disorderly exit from the bloc continue to keep most economists cautious about any sustained Sterling strength.
With most of the month’s UK economic data out of the way, the focus will shift back to Brexit as Britain heads towards several months of negotiations and several EU leaders’ summits.
Jeremy Hunt, the British foreign minister, warned that the short-term market impact if Britain leaves the EU without a deal would be significant, though he later said Britain could “survive and prosper” after a no-deal departure.
Business leaders’ confidence in the British economy has fallen to its lowest point this year reflecting the impact of uncertainty over Britain’s exit deal, according to a survey published this morning.
With less than eight months to go until Britain is due to leave the EU, the government is yet to agree the terms of its departure with Brussels and has stepped up planning for the possibility of failing to reach a formal agreement.
The survey of 750 business leaders, carried out by the Institute for Directors (IoD) employers’ group, found that after general economic conditions, uncertainty around trade with the European Union was the biggest concern.
Asked how optimistic they were about the wider economy over the next 12 months, more said they were pessimistic than optimistic, resulting in a net confidence level of -16 percent.
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