Write an essay on impact of brexit on global economy.
Answers
Answered by
0
The markets and the oddsmakers were caught off guard by the U.K.’s vote to leave the European Union. The immediate reaction in the financial markets was swift and violent owing to the surprise. Financial markets will likely calm somewhat after a period of shock and awe, but will find themselves settling into an entirely new vector of macroeconomic and geopolitical uncertainty.
• The Brexit vote will undoubtedly embolden other EU skeptic parties, particularly in the Eurozone heart of the EU. Other exit referendums may arise in the coming months to years. The U.K. itself may face an additional exit referendum from Scotland.
• The process of Brexit is without precedent, with only the most general timetable outlined in the Treaty of Lisbon. Thousands of details will have to be worked out in the process of unwinding the ties that bind Britain with the EU.
• The financial market reaction will also feed into the far-flung macroeconomic consequences of Brexit. For example, a sharp and sustained rise in the value of the U.S. dollar versus the euro will put added pressure on the weak U.S. manufacturing sector just as it seemed to find a new footing. This puts additional downward pressure on historically weak U.S. growth momentum.
• The Brexit vote will undoubtedly embolden other EU skeptic parties, particularly in the Eurozone heart of the EU. Other exit referendums may arise in the coming months to years. The U.K. itself may face an additional exit referendum from Scotland.
• The process of Brexit is without precedent, with only the most general timetable outlined in the Treaty of Lisbon. Thousands of details will have to be worked out in the process of unwinding the ties that bind Britain with the EU.
• The financial market reaction will also feed into the far-flung macroeconomic consequences of Brexit. For example, a sharp and sustained rise in the value of the U.S. dollar versus the euro will put added pressure on the weak U.S. manufacturing sector just as it seemed to find a new footing. This puts additional downward pressure on historically weak U.S. growth momentum.
Similar questions