Has Brexit caused inflation?

referendum, we estimate that the Brexit vote increased aggregate inflation by 1.7 percentage points in the year following the referendum. There is uncertainty about the exact size of this effect, but our analysis unambiguously shows that the referendum led to a substantial rise in inflation.

Is Brexit an exogenous shock?

From a researcher’s point of view, the referendum and the resulting depreciation of sterling can be regarded as an exogenous macroeconomic shock that was sudden, strong, and persistent.

Is inflation likely to rise in the UK?

Following the massive rise in wholesale gas prices, Fitch now expects CPI inflation to rise to 4.3\% by end-2021 (compared to 3.4\% in our September GEO) and to peak at just over 5\% next April. The energy component of CPI inflation is expected to rise by nearly 1pp in the coming months.

What are the effects of Brexit on the UK economy?

This could lead to delays at ports, such as Dover. Some fear this could lead to traffic bottlenecks, disruption to supply routes and damage to the economy. Combined with possible sharp falls in the pound, the price and availability of some foods could be affected.

How much did the UK economy grow in 2016 and 2017?

The economy grew by 1.9\% and 2.5\% in 2016 and 2017 respectively. However, the IMF has revised growth downwards to 2.2\% and 2.1\% respectively in 2019 and 2020 given the threat of rising protectionism and Brexit.

What happens to EU citizens living in the UK after Brexit?

There will be no change to the rights and status of EU citizens currently living in the UK until 30 June 2021, or 31 December 2020 if the UK leaves the EU without a deal.

What happens when the UK leaves the single market?

If the UK leaves the customs union and single market on 31 October, the EU will start carrying out checks on British goods. This could lead to delays at ports, such as Dover.