The approaching Brexit clearly has an impact on British economic growth, the media wants us to believe. According to the British statistics office, growth slowed to 0.2 percent on a quarterly basis in the fourth quarter of 2018, against a growth of 0.6 percent in the previous measurement period. These are preliminary figures. The British pound lost solid value after the publication of the figures.
The brexitic troubles keep entrepreneurs and consumers insecure, which puts a brake on the economy, while the weaker pound boosts the prices, putting the budgets of households under pressure. An economic progress of 1.3 percent was recorded for the whole of 2018, compared with 1.5 percent a year earlier. The growth delays were firmer than what connoisseurs calculated on average.
British households were also slightly more cautious about their expenses. Here in the last months of last year there was a growth of 0.4 percent, against a plus of 0.5 percent a year earlier. Companies also kept their hand on the cutting edge.
Furthermore, the statistical office reported a sharp decline in British exports. Growth was 0.9 percent on a quarterly basis. This was previously 2.7 percent. Imports of goods rose to 1.3 percent, against a stabilization in the previous measurement period. Industrial production and construction output were unexpectedly less in the closing month of 2018.
According to experts from ING, the British still face some challenges and the British economy will only grow modestly in the coming period. The economists emphasize that the no-deal brexit that hangs above the market creates a lot of uncertainty. Especially now that the 29 March deadline is approaching fast. According to ING, an interest rate increase in the first half of 2019 by the Bank of England seems highly unlikely.
The British trade minister Liam Fox said from a meeting in Switzerland that the cooling growth is not only due to the brexit. He pointed out, among other things, the weaker economic growth in China, which is also affecting other European countries.