Seven months after the first Brexit delay, the Hallowe’en deadline came and went with the UK’s Brexit predicament unresolved. Although Prime Minister Boris Johnson succeeded in negotiating a new Withdrawal Agreement with the EU, he was unable to convince MPs to back his timetable. As a result, he was forced to ask the EU for another extension.
- A Brexit flextension was granted until 31 January 2020
- The UK economy contracted in the month of August
- 85,000 UK retailing jobs were lost in the 12 months to the end of September
To view the series of market updates through April, click here
Seven months after the first Brexit delay, the Hallowe’en deadline came and went with the UK’s Brexit predicament unresolved. Although Prime Minister Boris Johnson succeeded in negotiating a new Withdrawal Agreement with the EU, he was unable to convince MPs to back his timetable. As a result, he was forced to ask the EU for another extension, and a “flextension” until 31 January 2020 was subsequently granted, allowing the UK to leave the EU sooner if a deal is approved. In the meantime – and after a certain amount of wrangling about a suitable date – a General Election was called to take place on 12 December.
“A General Election was called to take place on 12 December”
The European Parliament’s Brexit co-ordinator Guy Verhofstadt tweeted: “Relieved that finally no one died in a ditch. Whether the UK's democratic choice is revoke or an orderly withdraw, confirmed or not in a second referendum, the uncertainty of Brexit has gone on for far too long. This extra time must deliver a way forward.” The FTSE 100 Index fell by 2.2% during October, while the FTSE 250 Index edged up by 0.4%.
The UK economy shrank during August, according to the Office for National Statistics (ONS), which reported a contraction of 0.1%. Nevertheless, over the three months to the end of August, the economy expanded more strongly than expected, posting growth of 0.3%.
Having improved in September, UK consumer confidence declined during October against a backdrop of mounting political tension and Brexit-related uncertainties. GfK warned: “People can only feel confident if they believe the external environment is stable, yet consumers are witnessing too many Brexit shifts and surprises … The big black Brexit cloud is refusing to shift”.
According to the CBI’s Distributive Trends survey, retailers’ stock levels in relation to expected sales reached their highest-ever level during October ahead of the Hallowe’en Brexit deadline. Meanwhile, 85,000 UK retailing jobs were lost in the 12 months to the end of September, according to the British Retail Consortium (BRC), which has urged the Government to implement reform to its retail-related policies. The BRC found that the third quarter of 2019 represented the sector’s 15th quarter of year-on-year decline in the retail workforce. During October, fashion retailer Ted Baker reported a half-year loss and issued a profit warning, and clothing chain Bonmarché went into administration during the month.
A version of this and other market briefings are available to use in our newsletter builder feature. Click here
