By Grimsby Telegraph – By Nicola Birch
It’s just over two months since the EU referendum voted in favour of Brexit.
Last week, the first discussions about the timetable for our exit began in Government and this week, in Parliament, Grimsby MP Melanie Onn‘s bid to keep workers’ rights faced no opposition.
But what will leaving the European Union actually mean for us? Although the date of Brexit has not yet been decided, it has been hinted at.
Here we look at what has happened since the vote.
Before the referendum it was predicted by many economists that a vote to leave would mean an immediate to the UK economy and consumer confidence – but so far, this has not been reflected in the figures.
The UK’s services sector saw a record rise in August, according to a closely-watched survey. The sector, which includes everything from financial services through to cafes and shops, accounts for about 80% of the UK economy.
Confidence in UK shoppers throughour August improved, although it was below pre-Brexit vote levels.
New Prime Minister
David Cameron, who campaigned for remaining, announced his resignation over the referendum result.
Theresa May won the leadership contest when rival Andrea Leadsom pulled out.
Boris Johnson, who led the campaign to leave the EU, was made foreign secretary with his own leadership ambitions having been thwarted by his former Vote Leave ally Michael Gove.
Since Brexit the Bank of England has cut interest rates from 0.5% to 0.25% – it’s the first reduction in the cost of borrowing since 2009 and takes UK rates to a new record low.
One effect of the interest rate cut is that it has exacerbated the growing pension funds deficit because of falling bond yields. As yields fall it reduces the incomes pension funds get from their investments.
The pound plunged dramatically on 24 June, the day after the referendum. Since then it has remained at significantly lower levels because of uncertainty about the economic outlook and the UK’s relationship with the EU, hitting a three-year low of $1.2869 on 15 August.
The currency’s continuing weakness has been accentuated by the cut in interest rates and the Bank of England’s economic stimulus measures.
Against the dollar, the pound is now worth about $1.33. A year ago it was worth $1.57 – a fall of 15%. Against the euro, it is now worth about €1.19. A year ago it was worth €1.35 – a fall of 12%.
One of the most immediate consequences of this was that it made foreign holidays more expensive for British tourists, while it has also increased import costs for manufacturers.
However, one beneficiary of cheaper sterling has been the UK’s own tourism sector, as a weaker pound makes Britain a cheaper destination for overseas tourists.
There’s clear evidence of a spike in hate crime since the 23 June ballot. Reported hate crime rose by 57% in the four days after the referendum, police say.
Some 3,219 hate crimes and incidents – alleged to have taken place between 16-30 June – were reported to police forces across England, Wales and Northern Ireland, according to revised figures published by the National Police Chiefs’ Council. This represented a 37% increase compared with the same period in 2015.
The next reporting period, from 1-14, July, saw 3,235 reports of hate crimes and incidents. This was up only 0.5% on the previous fortnight but it was still a 29% increase on the same period in 2015.
When it comes to buying a home, there is some evidence that buyers have been discouraged by the Brexit vote.
August did see a “slight pick-up” in house price growth with prices up 5.6% on the year, according to the Nationwide. But this is probably because while fewer of us may be in the market to buy homes, fewer of us are also selling.
The number of homes for sale is at near 30-year lows, which is why the pace of house price growth has remained broadly stable. It’s a view backed up by Bank of England figures showing the number of new mortgages being approved by banks and building societies falling to its lowest for a year and a half in July.
This is in contrast to data published earlier from the Council of Mortgage Lenders (CML). But it is possible the Bank’s figures, which are more forward-looking, may give a more accurate indicator of the current housing market.
Looking ahead, there are expectations that UK house prices are set to fall in the short term as the market pauses for breath, before rising once again.
All the figures on numbers of people coming to the UK date from before the Brexit vote happened.
In the year to March net migration – the difference between the number of people coming to the UK for at least a year and those leaving – remained at near record levels, at 327,000. But this was slightly down on the previous year.
The figures showed a slowdown in the numbers settling in the UK from Poland and seven other Eastern European countries – but that was offset by an increase in net migration from Bulgaria and Romania, which hit record levels of 60,000.
Total UK unemployment dropped between April and June in the run-up to the vote, with the jobless total down by 52,000 to 1.64 million – leaving the unemployment rate at 4.9%.
But little of the data covers the period since the vote, so it’s not yet possible to draw any conclusions about the referendum’s impact.