After month of Brexit talks and still ongoing up to date, many investors and economists continue to worry over Great Britain’s economic growth and performance for the future, as several related nations began seeing the effects of Britain’s divorce from the European Union last June 23.
Recently, financial institution S&P Global said that UK’s economy is starting to show signs that it is losing its momentum.
“UK demand for funding from both businesses and households has been softening somewhat at the beginning of this year, which we believe is the first sign of the gradual slowing of the economy that we expect 2017,” Boris Glass stated, an S&P Global Senior Economist.
Many analysts already anticipated that with the Brexit talks still ongoing, Britain is set to experience challenges on many sectors of its government as the nation begins its transition of its independence from the EU.
Since Brexit began, many of Britain’s sectors suffered already, such as household spending, consumption growth, labour markets, UK manufacturing jobs and more. And although most recent financial data published by the UK still show promising security, other figures still point towards a probable lagging growth for demand for funding, both from businesses and household.
“While corporate financing costs have continued to edge even lower, thanks to an ultra-accommodative monetary policy, demand appears to have started to slip somewhat following the Brexit referendum,” S&P mentioned.
Meanwhile, many also see that UK Prime Minister Theresa May’s decision of hard Brexit can possibly have a bigger impact to the economy, which can add up between 5-10% of UK’s GDP by 2030.
Although short term figures released show better-than-expected resilient nature exhibited by the country, it is still highly likely that Brexit effect will slowly show in Britain’s economic performance in the future.
From the start of 2017, more uncertainties over the nation’s economy began to increase, especially with UK’s currency the British pound being in the bear market since the last week of February up to present trading session. GBP is currently trading against the US dollar at $1.2170 1403 GMT.
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