global & uk macroeconomic outlook · global & uk macroeconomic outlook 7th february 2017...
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![Page 2: Global & UK Macroeconomic Outlook · Global & UK Macroeconomic Outlook 7th February 2017 Andrew Goodwin agoodwin@oxfordeconomics.com](https://reader033.vdocuments.mx/reader033/viewer/2022060405/5f0f48eb7e708231d443667c/html5/thumbnails/2.jpg)
2016: solid year with Brexit having little impact…
![Page 3: Global & UK Macroeconomic Outlook · Global & UK Macroeconomic Outlook 7th February 2017 Andrew Goodwin agoodwin@oxfordeconomics.com](https://reader033.vdocuments.mx/reader033/viewer/2022060405/5f0f48eb7e708231d443667c/html5/thumbnails/3.jpg)
…but growth almost entirely reliant on consumers
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The impact of a weaker £ will be a key issue
Sterling changes: Since 1st July 2015 Since EU referendum
$/£ -20% -15%
€/£ -18% -11%
£EER -17% -12%
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Household spending power will be squeezed…
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…slowing spending growth through 2017-18
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Corporate sector is in good financial shape…
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…but investment intentions remain soft
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Austerity will remain a major drag
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Could exports could fill the void?
![Page 11: Global & UK Macroeconomic Outlook · Global & UK Macroeconomic Outlook 7th February 2017 Andrew Goodwin agoodwin@oxfordeconomics.com](https://reader033.vdocuments.mx/reader033/viewer/2022060405/5f0f48eb7e708231d443667c/html5/thumbnails/11.jpg)
Global economy should be more supportive
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Growth to become slower, but more balanced
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We remain more optimistic than the consensus
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Growth to remain subdued over medium-term
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Brexit impact to be felt over longer-term
Key
Policy direction:
LIB – liberal;
POP – populist.
Trade agreement:
EEA – membership of
European Economic Area;
CUS – part of EU customs
union;
FTA – UK–EU free trade
agreement;
MFN – trade with EU
according to WTO Most
Favoured Nation rules;
BIL – bilateral accords
Baseline assumption: Article 50 triggered in March. UK leaves EU in early-2019. 3-year
transitional arrangement similar to status quo leading ultimately to a free-trade agreement