What is recession?
Recession means a period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters. It’s also associated with increase in unemployment rate and high inflation.
What is No-Deal Brexit?
A No-Deal Brexit means Britain leaving European Union without any agreement and what would be their relationship in future.
Will Britain fall in recession?
Most of the analysts and rating agencies predicted that UK will submerge into recession. Even OECD (Organisation for Economic Co-operation and Development) and IMF also warns UK will face recession for next two years.
Even Jeremy Hunt who is the competitor of Boris Johnson said that he will prefer for No-Deal Brexit if he becomes Prime Minister and accepted that UK will be affected by Economic damage like 2008 financial crisis. Bank of England also cautioned that the economy will shrink by 8% with immediate effect and the recession period is estimated to five years. They are also expecting the economy may recommence in the end of 2023.
Currency Value and Interest rate:
Bank of England has warned that Pound may be banged to 10 – 25% down from the current levels because of No-Deal Brexit. The Interest rate would peak to 5.5%.
Economy and Inflation:
The Economy may slump to 0.8% growth in 2019 from 1.4% in 2018 according to thinktank. Last time UK economy was below 1% was in 2008 financial crisis. Inflation rate may rise to 6.5%
Unemployment rate and House Prices:
The Unemployment rate will surge to 7.5% and there is a prediction for decline in house price to 30%.