The National Institute of Economic and Social Research (NIESR) said there was a one in four chance Britain was already in a recession, with some economists claiming this to be down to talk of Boris Johnson opting for a no deal Brexit. Mr Johnson is widely believed to be crowned the new Prime Minister tomorrow morning after batting off a six-week long challenge from rival Jeremy Hunt. NIESR said in a statement: “The short-term outlook for the UK economy is very murky indeed, with a significant risk that a severe economic downturn will begin within the next six months.”
They told The Guardian the likelihood of a no deal Brexit under Mr Johnson’s leadership may have seen the UK’s economic growth halt to a standstill.
They added investment in the UK has waned and the value of the pound has fallen sharply.
NIESR said GDP fell by 0.1 percent in the second quarter of the year, adding there is a 25 percent chance it will slip again in the third quarter between July and September.
But the same think tank also said their forecast for growth is 0.2 percent in the third quarter, which contradicts their original expectations.
Despite the latest growth figures not having been published yet, some economists think the UK economy suffered massive losses in June as a consequence of factory closures and job losses.
NIESR director Jagjit Chadha added a no deal Brexit would “throw concrete” in the wheels of a trade deal with the EU when the UK is already “fragile and vulnerable” from a slowdown in growth.
He added: “However we look at it, there will not be much economic joy in such an exit.”
Tomorrow the new Prime Minister will be announced, with it being widely expected to be Boris Johnson following a series of hustings up and down the nation.
During the hustings he has spoken openly about taking the UK out of the EU without a deal should nothing come of one final push with the bloc.
