Hello and welcome to our latest Beyond Brexit podcast. I'm Emily Kahn. Today we're revisiting

one of the big questions, how will Brexit impact the UK economy? I'm joined once again by two of

our senior economists, Mike Jakeman, who works on our UK Economic Outlook series, and Barrett

Cappellion, who's been working on economic

impact analysis for our own Brexit preparations as well as for our clients.

Mike, I'd like to come to you first if I may.

When we were last together on this series in January, the main assumption behind your projections

was a reasonably smooth exit in March and a projection of 1.6% GDP growth in 2019.

Now, events have obviously moved on a bit since then, so take us through what your main scenario is at this point in time.

Hi, Emily. Nice to talk to you again. January seems like a very long time ago. Doesn't it? So much has happened since then.

I think the best way of thinking about how Brexit's affected the UK economy so far this year

is that we actually had a relatively good first quarter for the economy.

So household spending held up as it has done ever since the referendum.

People are continuing to spend money,

probably in the absence of really known what else there is to do. But what we saw is that

business investment, which has been where Brexit's really hit the economy so far, actually

did quite well for the first time in a year or so. But the reasons for that aren't necessarily

all that great. It's that businesses saw this March 29th deadline for Brexit and stepped up their no-deal planning.

So we saw a good quarter for the manufacturing industry and a lot of imports as well.

Those two things together meant that businesses spent a lot of money preparing themselves for what they would do if there was a sudden no-deal Brexit on March 29th.

Absolutely. And that would chime with what I was seeing and hearing around that time

about people looking at stockpiling as one of their priority contingency actions.

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