No-deal Brexit to plunge UK into year-long recession, warns fiscal watchdog

UK output falls by almost 2% under the least-worst no-deal Brexit scenario, said the watchdog

A no-deal Brexit could plunge the British economy into a yearlong recession, hammer the pound and house prices and add tens of billions of pounds to government borrowing, according to the UK fiscal watchdog.

The Office for Budget Responsibility analysis is based on the “less disruptive” of two no-deal Brexit scenarios modeled by the International Monetary Fund in April.

Brexit Blow

UK output falls by almost 2% under the least-worst no-deal Brexit scenario.

“Heightened uncertainty and declining confidence deter investment, while higher trade barriers with the EU weigh on exports,” the OBR said in its fiscal risks report published Thursday.