A new paper by a group of experts including a senior Bank of England economist finds Brexit reduced UK GDP per person by 6–8% over the past decade—equivalent to a £180–240 billion hit—roughly double the Office for Budget Responsibility’s 4% estimate; the research has been presented to the OBR. If sustained, the larger-than-official damage implies a materially bigger drag on growth and public finances than currently reflected in government forecasts, with potential consequences for fiscal planning and economic policy.
A new paper by a group of experts including a senior Bank of England economist finds the 2016 Brexit vote reduced UK GDP per person by 6–8% over the last decade, equivalent to a cumulative hit of £180–240 billion. The authors presented the study to the Office for Budget Responsibility; by contrast the OBR's official estimate is a 4% hit, so the paper implies roughly double the long-run damage claimed in government forecasts. If policymakers and markets accept the higher estimate, the gap implies a materially larger drag on growth and public finances than currently reflected in fiscal projections, which could necessitate higher borrowing, spending trade-offs, or altered issuance plans. The paper therefore directly challenges the foundation of current fiscal planning and increases the risk that official forecasts and market pricing will be revised. Market-signal outputs show strongly negative sentiment and modest market-impact scoring, indicating investor concern without immediate widescale repricing; sterling, gilts and domestically exposed equities are the most likely sectors to react as forecasts change. Key uncertainties to watch are the OBR's formal response and any follow-up government fiscal adjustments, which will determine the timing and magnitude of market repricing.
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strongly negative
Sentiment Score
-0.65
