UK to fall into recession in H2 16 – Danske Bank

Mikael Olai Milhøj, Senior Analyst at Danske Bank, expects the UK to fall into recession in H2 16 or early 2017, which would likely cause unemployment to rise with a lag.

Key Quotes

“The UK is likely to be hit by falling investments in H2 16 due to higher uncertainty about the future economic environment for British firms. It is also likely that private consumption will slow due to higher uncertainty.

In 2017, the growth outlook depends on how the withdrawal negotiations are progressing. The longer-run macroeconomic consequences depend on the future UK/EU relationship. If many partial agreements are reached, the negative impact could be minor. If no agreements can be made, the negative impact could be major.”