David Blanchflower, professor of economics at Dartmouth College and member of the Bank of England’s monetary policy committee from June 2006 to May 2009:
The fallout from the disastrous Brexit vote and the even more calamitous negotiations are scaring businesses to death, and continuing apace. House of Fraser has announced it will be closing down 31 out of 59 stores. Airbus and BMW both warned of the severe consequences of a disorderly Brexit. Airbus closing plants in the U.K. would have an especially bad impact on jobs in Wales, where Airbus has a major plant, that inexplicably voted for Brexit given it has the most to lose of almost anywhere from leaving the EU.
A Baker McKenzie survey of 800 business leaders in France, Germany, Spain, the Netherlands, Sweden and Ireland found that nearly half of respondents say their company has reduced investment in the U.K. since the Brexit vote. No wonder many thousands demonstrated against the Brexit madness last weekend.
It appears that the Brexit vote has already cost the U.K. between £20bn and £40bn. The ONS reported that in April manufacturing output dropped 0.5 percent, which is the largest fall since May 2017. GDP growth was 0.1 percent in the first quarter and the National Institute of Economic and Social Research has forecast it will be only 0.2 percent in the second quarter. As a consequence the pound continues to slide on the obvious economic weakness. The pound is worth more than 10-percent less now than on the eve of the Brexit vote. The bad news continued with the trade deficit rising to the second highest on record.
Three members of the MPC this month — Haldane, McCafferty and Saunders — inexplicably voted for a rate rise, based on wishful guessing and entirely ignoring the data from the real world. They know not what they do. They said they just knew that the data declines were temporary that wages were set to explode.
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