Brexit: The economic, political and financial fallout

The Brits’ June 23 vote to take the United Kingdom out of the European Union (EU) came as a surprise. Brexit (for “Britain-exit”) dealt a hard blow to the financial markets, which were not prepared for this eventuality. This Economic Viewpoint takes a look at the potential repercussions of the decision that British voters made. The most plausible hypothesis is that the United Kingdom and the EU will, in the end, manage to negotiate an accord that will limit the impact on the economy. In the near term, the financial shock should be temporary, but it will still have longer-range economic and political effects, which will require some adjustments to our recently released economic and financial forecasts.