Business Judgement

A catastrophe, a tsunami, a return to austerity. Britain’s budget deficit is likely to more than double to around 100 billion pounds if the country leaves the European Union without a deal, a leading think-tank said on Tuesday. The Institute for Fiscal Studies (IFS) predicted borrowing would rise to 92 billion pounds - equivalent to 4% of national income - by 2021/22 under a “relatively benign” no-deal Brexit scenario , in which there are no major delays at borders. Even then, the economy would still enter recession in 2020, the IFS said in an annual assessment of the public finances. IFS added that total debt would soar to 90% of national income. "The government is now adrift without any effective fiscal anchor," said IFS director Paul Johnson. The Treasury said any decisions would be made "with a view to the long-term sustainability of the public finances ". If the government undertook enough fiscal stimulus to stop the economy contracting - roughly 23...

The economy of UK contracted at a quarterly rate of 0.2% in the second quarter, the Office for National Statistics (ONS) said on Monday. According to the ONS, the services sector continued to provide the main positive contribution to overall GDP growth, but slowed to its weakest rate in three years, alongside falls in the production and construction sectors in Q2. With an upwardly revised rise of 0.6 percent in the first quarter, the British GDP has been volatile through the first half-year of 2019. The ONS noted that the volatility largely reflecting changes in the timing of activity related to Britain's original planned exit date from the European Union in late March. "There is evidence that stockpiling and the change in timing of activity was taking place in the first quarter of the year, which likely provided a boost to GDP, with the latest figures suggesting that these increased stock levels were partly run down in Q2", the ONS said. ...