As the days get shorter and the UK's July heatwave fades away into hazy memories, the countdown to Brexit has seen a great deal of political posturing over the summer and without doubt it is casting a shadow over the real economy. As business and consumer confidence has been waning due to the uncertain outlook ahead, investment decisions have been shelved, although there is a more positive trend with UK exports benefiting from the decline in sterling. However it's probably not been appreciated by those holidaying abroad this summer with the pound being weaker.
With the Brexit negotiations now resuming in the last week or so there appears to have been some softening in its negotiating position from the EU which might mean a deal is achieved which does not result in the possibility of the UK economy having to face a sharp 'adjustment' in 2019. The Bank of England's decision to raise bank rate to 0.75% is not expected to be repeated any time soon and many still expect it to be no more than 1% by the end of next year. That is in sharp contrast to the US economy which is motoring ahead.
As we report in our news analysis on page 38, the extended ripple effect out of London on residential values in the UK's cities is seeing some sharp contrasts. The north west regional residential market appears to be in rude health with Manchester in boom mode and a rebound occurring in Liverpool. And yet as we report in our lead article on page 16 there is some revealing comment about locations in the north of England where yields are much higher than they were over ten years ago.