A month post-Brexit: The impact on various economic sectors

After a month since Britain voted to leave the EU, has its economy taken a blow as experts predicted it would?

                                                         Image source: afr.com

Officially a month after the U.K. referendum to leave the European Union, the Office for National Statistics is expected to release an official data chart about consumer prices, jobs, and public finances. Several economists and banks such as the Bank of England and Markit already released forecasts expressing the possibility of the U.K. falling into a recession, although investors are yet to see official reports. This is based on the declining rate of inflation in July as well as household spending weakening more rapidly.

On the other side of the spectrum, the number of people claiming unemployment benefits fell by 8,600 between June and July, making the unemployment rate at a steady 4.9 percent for 11 years now. While contrasting data from economists and trade associations appear, the seemingly changing movement in the U.K. economy post-Brexit is not entirely discouraging.

Interestingly, public confidence has also recovered this month, despite the fear most people had about Brexit harming job prospects and wage increase. This new level of confidence was mostly expressed by the highest earners and private sector workers while the low earners and workers at the public sector remain pessimistic about the referendum.

In the U.S., economists expressed fears about the possible consequence Brexit has on the export sector. The impact of Brexit on the American economy will not be as profound in relation to the overall economic activity. However, the regression could be deepened if the consumer sentiment continues to fall and Americans spend less. This will definitely affect the performance of the US economy as a whole, as consumers fear what Brexit may bring.

                                             Image source: theguardian.com

My name is Steve Sorensen. I am a finance professional and business analyst offering financial advisory services to both the public and private sectors. I also help businesses design strategies to avoid employee embezzlement and improve retirement plans. Please follow me on Twitter for similar updates.