'Brexit is an optimistic story' International economist backs EU departure

Posted in Google Brexit News
at 2016.10.31
With 0 Comments

'Brexit is an optimistic story' International economist backs EU departure

Dambisa Moyo, an economist and Barclays board member, says there is an “optimistic story to be told” about the decision to leave the EU and said there will be a resurgence in the pound’s value after its recent dip.

The pound is currently the world’s worst-performing currency in October, putting it behind around 150 peers as the process to leave the European Union rumbles on.

Sterling headed for its biggest monthly decline against the dollar since Britain’s vote to leave the bloc in June. 

Despite the negative effects of Brexit, Ms Moyo, told Russia Today’s Going Underground it was “too early to tell” about the pound’s future value.

The economist said: “It’s too early to tell. I think there’s two things public policy makers need to determine.

“Number one is the timing, obviously we are waiting for Article 50, the indications are now that we’ll have a bit of clarity once March comes.

“The other thing is the direction of the trajectory of public policy – we don’t know what the key drivers are, it could very well rally.

“I think there’s an optimistic story to be told about the UK – the IMF’s new revisions for growth for 2017 a couple of weeks ago on the world economic outlook they think that growth will pick up in the UK.”

Accountancy firm EY have warned retail prices are likely to rise next year because of the pound’s unpredictable future.

It said currency hedges taken out by firms to protect themselves from wild swings in the foreign exchange market will expire in 2017 and that goods will cost more because of pound’s diminished purchasing power.

Jessica Clayton, EY’s head of retail restructuring, said” “Although Brexit was not the main driver for profit warnings this summer, its secondary effects have potential to tighten the margin vice even further.

“The impact of the weakened pound may be delayed by currency hedges, but at some point something will have to give at the till or further down the supply chain.”

Ms Moyo, however, supported Britain’s decision to separate from the 28-nation bloc after previously insisting Remain was the right way to vote.

She added that there is “increased political uncertainty” across the world and not just in Britain and democratic control will help them overcome any issue.

The economist continued: “The thing about living in this period is we don’t have clarity on what the direction is politically or economically. 

“I think we do need to revisit a lot of models and strictures that we’ve relied upon in the twentieth century.”

Let’s block ads! (Why?)

Published at Mon, 31 Oct 2016 16:51:26 +0000

Leave a Reply

Your email address will not be published. Required fields are marked *