Soft Brexit equals recession

Our modern economy is based on consumer confidence. This partly explains why the UK has prospered since June, “despite Brexit” – the majority of consumers voted for Brexit, so by definition, the majority of them are confident the decision was the right one and the prospect of leaving the EU does not make them nervous enough to change their spending habits. In turn, contrary to some accepted wisdom, a ‘soft’ Brexit would pose a bigger short term financial risk than ‘hard’ Brexit – if consumers think their prescription for the UK’s politics and economics is being ignored, they are likely to be less confident about the future and reduce their spending accordingly.

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