At the start of 2017, most economists are still pessimistic about Brexit’s effect on Britain’s longer-term economic prospects. Britain got a new Prime Minister, Theresa May, and previous prime minister, David Cameron resigned. Both were against Britain leaving the EU.
For the UK to leave the EU it must invoke an agreement known as Article 50 of the Lisbon Treaty. Both the UK and EU have 2 years to agree to the terms of the split, but Theresa May wants to get this process into motion by end March 2017.
Uncertainty with Business Decisions
They say 2017 isn’t going to be an easy ride As the months have passed since Brexit, the economic consequences have been less about financial market disruptions and more about uncertainty with business’s decisions – whether to make capital investments or not. This indecision isn’t only happening in British-owned businesses, but in affiliates of global companies in Britain.
There are concerns over prospects for 2017 as there are signs emerging that the Brexit vote’s blow to the pound is encouraging inflation.
The pound has also come under new pressure recently, taking downward lurches. A spokesperson from the Council on Foreign Relations reckons that in 5 years time there won’t be a United Kingdom. The UK is rapidly becoming poorer and the weakening of the British pound will add to the economic problems of Europe and Japan and even further afield.
Pakistan already feeling the effects of Brexit
Pakistan is also a country who has felt Brexit’s effect. PSX lost about 1700 points – about 1000 points below its pre-Brexit level. Pakistan’s exports will suffer too, and Pakistan has been concerned about whether exports to the UK will lose duty concessions under EU’s GSP plus. This is also because the UK was an advocate for Pakistan’s GSP plus case in Brussels. Pakistan happens to be a major recipient of UK’s overseas development assistance, and loss in economic growth could lead UK to reconsider its ODA level which would affect assistance to Pakistan.
Another spokesperson, but from the American Enterprise Institute says that the United Kingdom could break up, but that much depends on the quality of leadership from within the UK and the EU. If national leaders address the real problems such as the never ending flood of refugees, then they suggest that Brexit will be a wake-up call, otherwise it could spell anger, the wrong decisions, isolationism and worse.
As it is, Theresa May has said she wants to see a reduction in immigration, saying this will be a focus of Brexit negotiations – to bring the numbers of people entering the country down to a sustainable level.
Others believe that the United Kingdom in the next few months will be in a recession and there will be more support for populist parties across many European states.
The bad times can be good times too
This may sound strange to many, but there’s never a dull moment on the stock market, and as always, 2017 is both volatile and exciting for traders. It’s what makes it so attractive for those looking to earn some extra money because you don’t know what might be around the corner. One thing that is certain when you start trading is to get yourself a reputable online broker. CMC Markets are registered, licensed and award winning and they will show you how to have fun trading and to still make yourself some extra money when all else seems uncertain. History is full of examples of those who have reaped rewards for being adventurous when others got cold feet and succumbed to fear.
Unpredictable but always Fun and worth a Go
The question is will the stock market also get caught up in Brexit blues and the political instability in the world? Stockbrokers and personal finance experts all agree that there is never complete certainty in the markets, But this is what makes trading so enthralling. Financial experts agree that if January 2017 remains positive for stocks, returns for the remainder of 2017 look to be pretty positive too.
