Brexit: A very slow motion train crash – SocGen

Research Team at Societe Generale, suggests that Brexit is a not a ‘Lehman moment’ that will trigger an unforeseen chain of events.

Key Quotes

“Policymakers and companies have had time to make contingency plans, even if they can’t fully offset the impact. A period of uncertainly starts with the need to choose a new leader of the Conservative Party, then goes on to a drawn-out process of untangling the UK from the EU. Uncertainty is bad for UK growth and won’t help Europe either. That wouldn’t matter if the global economy were ticking along nicely but it isn’t.

We expect the pound to fall another 10% over time, and the euro may fall by about half that much. Soggy growth in developed economies won’t fuel dramatic FX moves and volatility may be lower going forward, but it would be broadly negative for EM and commodity exporters.”