Report
Patrick Artus

What accounts for the decline in the UK economy since Brexit?

The UK economy has been weakened by Brexit, and this is clearly evident when we compare UK growth with that of the euro zone. What accounts for this decline in the British economy since Brexit? At first sight, the following factors may explain this decline: A decline in trade in goods and services with the European Union, not offset by growth in trade with the rest of the world; A decline in corporate investment and housing investment, as the United Kingdom becomes less attractive for investment; A decline in capital inflows from the rest of the world with, in particular, London losing its role as a financial centre; A loss of jobs due to the fall in immigration from the EU, affecting the efficiency of the economy; High inflation due to restrictions on trade in goods. We can see that the relevant explanations for the decline in the British economy are: The decline in corporate investment; The decline in foreign direct investment in the United Kingdom; which shows the decline in the United Kingdom’s attractiveness.
Provider
Natixis
Natixis

Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.

 

Analysts
Patrick Artus

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