Post-Brexit Blues

The past couple of days have seen the first of the economic indicators from the post-Brexit referendum period published. And the news has been predictably depressing. First up was yesterday’s Lloyds Business Barometer, a survey with a sample size of over 200 companies, which was conducted in the first few days after the referendum. Its headline index plummeted from 32 to a four-and-a-half year low of 6, while a fall in the current economic optimism indicator was even more pronounced, both suggesting a big hit to business confidence as a result of the referendum result.

UK: Lloyds Business Barometer

UK Lloyds Business BarometerSource: Lloyds, Bloomberg and Daiwa Capital Markets Europe Ltd

This was followed by last night’s special one-off GfK survey reported the biggest drop in consumer sentiment index in twenty one years to its lowest level since 2013. Consumers’ assessment of the future outlook for the UK economy, which was even more pessimistic than the headline measure, with the relevant index falling to -29, a level not seen since late 2012 when GDP growth was negative. All of the other major survey components posted significant declines too with a striking fall (the largest since the start of 2011) in the measure related to willingness to make major purchases.

UK: GfK Consumer Confidence

UK: GfK Consumer ConfidenceSource: GfK, Thomson Reuters and Daiwa Capital Markets Europe Ltd.

So, as predictable as they are depressing. But they are just the first taste of what’s to come. The coming weeks will see a growing body of evidence showing exactly how hard the economy has been hit by the referendum vote. We have compiled a UK economic data calendar (see below and attached here) highlighting which data will give the best indication of the referendum impact. The entries in light blue are data which cover the post-referendum period in part. The dark blue entries, meanwhile, are releases where the data will be collected entirely after the referendum result was known. First up, of course, will be the post-referendum surveys to be announced from the end of this month onwards, with the PMIs at the start of August. But the first of the hard economic indicators from the ONS will only arrive in the second half of August. 

UK Post-Brexit Economic Calendar

Post Brexit Calendar
*Based on the number of days covered.
Source: ONS, Bloomberg and Daiwa Capital Markets Europe Ltd.




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