Finance chiefs finally face up to Brexit threats
SENTIMENT is the most important driver of economic activity. If people and businesses lack confidence about the future or are faced with immense uncertainty, the natural response is to postpone spending or investment decisions and do whatever it takes to guard against potential risks actually materialising. The UK in recent months has provided a very good template for how this works.
Before and after the Brexit referendum, those on the ‘leave side’ argued that it would not fundamentally damage the economy, in the longer term at least. That may turn out to be case, although I doubt it somehow, but it is clear the uncertainty and fear created by the vote to leave is now very real and is having a significant short-term impact.
