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Hard Brexit scenario odds at 25% - Reuters Poll

According to the results of a Reuters poll. odds are roughly 1-in-4 of a hard-style exit from the EU for the United Kingdom.

Key quotes

"Reuters Aug. 29-Sept. 3 poll was conducted as pressure mounts on British Prime Minister Theresa May, who is struggling to sell what she calls her business-friendly Brexit to her own party and across a divided country.

With less than two months before Britain and the EU want to agree on the terms of Britain’s leaving the bloc, the two sides are still sparring. When asked the probability of a disorderly Brexit, whereby no agreement is reached by the end of March 2019, the median forecast in the poll was 25 percent - unchanged from an August estimate.

However, nine of 34 common contributors in this poll and the last raised their numbers and the highest prediction was 60 percent. Four reduced their odds and 21 left them unchanged. “The chances of the UK leaving the EU has undoubtedly risen recently, and we have become less confident of an orderly exit,” said Howard Archer at EY ITEM Club.

With a deal considered likely, the chance of a recession remains remote. Medians gave the likelihood of one in the coming year as 15 percent, down from 20 percent given in July, and within two years at 25 percent. But as there is still little clarity on how Britain will trade from April, and as a global trade war escalates, median forecasts for post-Brexit economic growth were revised down from August projections. Expansion is now put at 1.4 percent next year, down from 1.5 percent given last month, and an unchanged 1.6 percent in 2020.

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Joshua Gibson

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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