NIESR said in a report that “we would not expect economic activity to be boosted by the approval of the government’s proposed Brexit deal.” Instead, the new Brexit deal could lover UK GDP growth by -3.5% in the long run, comparing with continued EU membership.
Under the main-case scenario, economic conditions are set to “continue roughly as they are” with “underlying growth remaining weak and well under its historic trend.” As likelihood of no-deal Brexit is reduced, so is downside risks to growth.
NIESR also expected a cut in BoE Bank Rate by -25bps to 0.50% in 2020. Together with loosened fiscal policy, both are expected to support growth in the near term.
