Last 6 months have been quite bad for UK businesses. The companies have witnessed lowest growth rate in past 6 years. The companies accuse the fear of a no-deal Brexit and increasing trade barriers as the main reasons for this slump. The information has been provided by the Confederation of British Industry (CBI).
The agency’s private sector index has dropped by 3 points in past 3 months. The index was 0 in January and now it stands at -3. This is the lowest growth rate since April of 2013. This was the year when UK was still recovering from the losses of global recession. The businesses are still expecting the low growth rate in the upcoming months. In next 3 months Britain is supposed to leave European Union; this is an end to 40 years of membership.
Theresa May, the Prime Minister of UK is yet to get the approval from the Members of the Parliament regarding the deal she has framed for Brexit. As per the business experts she might have framed a way to delay the Brexit beyond the schedule date of 29th March 2019. According to Rain Newton Smith, the chief economist from CBI, the companies are slowing down their investments and delaying the business decisions due to Brexit.
According to a survey which took place last week, manufacturers are stockpiling goods; it is an effort to cope up with the probable delay in delivery of goods across the borders after Brexit.
Another report from the Bank of England, British economy grew only by 0.2% from January to March. The Bank is also speculating a low growth throughout the year even if Brexit goes well. This is a similar situation faced by other European countries as well; this is due to trade issues between US and China.