Has Brexit now been priced-in

HornetSaver

Now that article 50 has been triggered (albeit over nine months later than most would have expected), we finally have clarity on certain points:

We are definitely leaving the EU.

The UK has officially, formally, publicly stated its intention to leave the single market on the basis that it acknowledges that its refusal of one of the four freedoms is incompatible with single market membership.

The pound appears to have settled at a new normal against the Euro and Dollar. That is to say, before a deal is reached, imminent, or the deadline approaches with no deal in sight, it appears that currency fluctuation over the next couple of years are unlikely to be of the same scale as those seen in the second half of 2016, and if they do happen, are relatively unlikely to be as a result of the Brexit process.

There remains consensus between the UK and EU on respecting the current rights of citizens of one living in the other post-Brexit.

It is clear that the Government position is that it's preferred option is for a trade deal outside of a single market, with additional transitional arrangements, and a new customs deal. Equally, it's clear that "no deal" and WTO trade rules is not out of the question. Indeed, there's an ironic convergence of opinion between those most strongly pro-Brexit might feel that the EU will deliberately steer us in that direction because they're that malicious and/or incompetent, and those most anti-Brexit might feel that we'll end up in that position due to the EU's duty to protect its members' interests and/or the Government's unrealistic expectations. Most in the middle on both sides of the debate would come to the conclusion that a pragmatic, functional deal of sorts will be reached - whether you believe said deal is good enough to mitigate the short term problems and maximise the long term opportunities will generally depend on which way you voted. I think in practise a significant majority believe that there will be a deal with the EU, though as stated I think this debate will create some strange lines of agreement and disagreement between people who would normally disagree on the colour of the sky.

So, regardless of people's political opinions on whether Brexit is going to be an improvement, a detriment, or make little difference in people's day to day lives. To what extent can it be said that Brexit has now been priced in?

the_flying_pig

Partly yeah but with so much uncertainty over the form of the final agreement and the short/medium/long- term impact on business and consumers we're imo only just getting started.

System

Life's full of uncertainties; The Trump effect, European elections, fate of the Euro, new Greek/Italian/Portugese debt crisis, China overheating, Putin and Eastern Europe, weather/harvests, etc etc etc.

There are lots of things that "have only just started", everything gets priced in from day to day depending on better knowledge, statements, rumours, prejudices, mistakes. Brexit is just one, relatively minor factor in the history of the world.
What will really decide? - "Events, dear boy", as Macmillan famously said.

westernpromise

It's been fully priced in since June 24.

Conrad

WTO has been priced in since the vote.


One day even the most ardent Remainers will look back see this merely as a slight change in the way we traded.

Filo25

Conrad wrote: »

WTO has been priced in since the vote.


One day even the most ardent Remainers will look back see this merely as a slight change in the way we traded.

I see nothing to indicate that the 100% certainty of reverting to WTO rules is priced in today, never mind being priced in immediately after the vote.

Reversion to WTO terms is certainly a known risk out there, but still not viewed as the most likely outcome, there will no doubt be fluctuations in Sterling as that outcome looks more or less likely (you could see a similar impact last autumn around the time of the Tory party conference, when May started talking up immigration control as being a higher priority than trade), but realistically we're probably facing a fair amount of posturing from both sides in the negotiation for a while.

Full reversion to WTO rules would be far from a "slight change to the way we traded" with our largest and of course geographically closest major trading partner.

wotsthat

As ever something has been priced in but whether the price is correct remains to be seen.

Sterling will continue to be the measure to watch IMO. What is seen as a decent deal will lead to it strengthening. A poor deal will lead more of its value being flushed down the toilet.

westernpromise

There was never any doubt the result would be implemented. If the courts or someone else had blocked a manifesto promise to implement the referendum result, there'd have been a general election in which the Tories would have won 400 seats, thanks to Corbyn.

The degree of hostility from the EU points to a worst case Brexit and has done for months. The actual outcome will be no worse than what has been floated, probably better. So this has been fully priced in all along and will gradually come out of the price as matters proceed.

Thrugelmir

Household savings ratio falls to record low, says ONS

http://www.bbc.co.uk/news/business-39453844


Far too much focus on Brexit. Plenty of issues elsewhere that require addressing.

HornetSaver

Thrugelmir wrote: »

Household savings ratio falls to record low, says ONS

http://www.bbc.co.uk/news/business-39453844


Far too much focus on Brexit. Plenty of issues elsewhere that require addressing.

Agreed, as you say in most cases the problem to be fair is not Brexit in and of itself (we haven't left yet, therefore beyond inflation due to the currency shift, it can't be having too much direct effect yet), but the unbelievable extent to which Brexit is a cover for every other political story.

Even the NHS and schools are only popping their heads above the surface because of the sheer extent to which their fortunes have ventured south. Second tier issues such as the state of the roads, local taxation hikes and stealth taxes are getting worse left, right and centre without so much as a ripple from the media.

Thrugelmir

HornetSaver wrote: »

Agreed, as you say in most cases the problem to be fair is not Brexit in and of itself (we haven't left yet, therefore beyond inflation due to the currency shift, it can't be having too much direct effect yet), but the unbelievable extent to which Brexit is a cover for every other political story.

Even the NHS and schools are only popping their heads above the surface because of the sheer extent to which their fortunes have ventured south. Second tier issues such as the state of the roads, local taxation hikes and stealth taxes are getting worse left, right and centre without so much as a ripple from the media.

Council tax bills have been arriving recently. Be a few people in for a shock. We were surprised by the % increase on our modest abode. A Brown moment. No increase in income tax or national insurance. Knowing full well there's other ways of skinning a persons pocket.