UK economy expands at steady pace despite Brexit vote
LONDON – Britain’s economy appears to have largely avoided a big hit from the Brexit vote in June and is growing at a steady pace while companies have grown slightly more optimistic about the outlook, the Confederation of British Industry said on Sunday.
The CBI’s growth indicator rose to +8 in August from +5 in July when Britain was in the grip of a political crisis triggered by the decision by voters to leave the European Union.
Consumer services companies grew moderately in the three months to August while manufacturers expanded more slowly, the survey of 833 companies showed.
“While it’s still early days following the EU vote, the economy is continuing to grow at a steady pace, despite mixed performances across different sectors,” Rain Newton-Smith, CBI chief economist, said.
The pound’s plunge since the vote to leave the EU had helped exporters but will put upward pressure on inflation and erode household spending power, she added.
Other business surveys have also suggested the economy avoided a sharp hit from the Brexit vote, but some indicators of business investment have suggested it could slow in 2017. The Bank of England has said it expects no growth in the second half of this year and it may cut interest rates again soon. -Reuters