UK’s NIESR sees one in four chance UK already in a technical recession


The UK think tank, the National Institute of Economic and Social Research (NIESR), warned that the British economy may have fallen into a technical recession, in the face of disorderly Brexit risks.

Key Findings:

Sees 2019 GDP growth +1.2%, 2020 +1.1%.

Assumes no-deal Brexit avoided.

Severe downturn possible in case of disorderly no-deal Brexit.

UK economy would stagnate in 2020 in case of orderly no deal, return to growth in 2021.

Sees one in four chance UK already in a technical recession.

Expects BOE to raise interest rates to 1% in H2 2020 in case of Brexit deal.

Sees roughly 40% chance of no deal Brexit.

Long run impact of no deal Brexit will be to reduce GDP by 5% vs. staying in EU or soft Brexit.

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