Brexit is back in the headlines this month. Despite the new secretary, Dominic Raab, stating his confidence in negotiating a good deal, the majority of commentators are starting to discuss the possibility of a no-deal Brexit.
The potential impact of a no-deal Brexit
Last Thursday the UK government released 28 documents which assessed the potential impact of a no-deal Brexit. The Financial Times has broken down each of the papers and given a summary of each issue. International workers are naturally concerned about both the economic impact of a no-deal and the legislative changes that are likely to impact their residency across Europe.
If you are a UK National living in Europe, in the event of a no-deal you would need to apply for an International Driving Permit as your UK licence would no longer be valid.
For UK businesses who regularly bid on EU contracts, a no-deal would remove the ability to use the TED procurement database (The Official Journal of the EU via Tenders Electronic Daily). The impact of this would be significantly reduced if the UK were able to produce an alternative procurement database quickly.
Moody’s has warned that a no-deal could trip the UK into a recession. They also predict that this would trigger a sharp fall in the pound with an adverse outcome on real wages forecast for the next three years. Moody’s also predicts that EU countries with close trading links or close to the UK would also see a negative impact from a no-deal outcome; this is likely to include Ireland, the Netherlands, Cyprus and Malta.
Faltering FAANG* stocks?
Apple became the first company to hit a $1tr stockmarket evaluation ahead of their 2018 keynote speech. Netflix has been showing signs of recovery after its slump in July. Facebook and Alphabet have had slow summer months but with retail advertising gearing back up as Christmas approaches they may make up their losses. It will be worth watching the performance to see if FAANG gets back on track.
Acceleration for the Indian economy
Despite trade tensions, the economic growth in India grew to 8.2% in Q2. Up from 7.7% in Q1. The robust economic growth was driven mostly by the construction and manufacturing sectors.
*FAANG is an acronym for the market’s five most popular and best-performing tech stocks, namely Facebook, Apple, Amazon, Netflix and Alphabet’s Google.
