A closely watched survey of private sector activity showed the bleakest outlook for U.K. businesses since July 2016 — which was right after the country voted to leave the European Union.
Why it matters: The Brexit back-and-forth has left businesses in a tailspin amid a softening global economy.
- Companies attributed the downbeat conditions to "a lack of clarity in relation to Brexit, alongside a fresh injection of business uncertainty from the forthcoming general election," per the survey.
- It's still unclear if or when the U.K. will leave the EU, and the December general election may do little to provide clarity.
The backdrop: The British economy shrank for the first time since Q2 in 2012. The most recent data shows that the country marginally avoided a recession, with 0.3% GDP growth in Q3.
The big picture: The results push "the PMI further into territory that would normally be associated with the Bank of England adding more stimulus to the economy," Chris Williamson, an economist at IHS Markit, said in the survey's press release.
- Two Bank of England officials voted for the central bank to cut rates earlier this month — splitting with the rest of the monetary policy committee.