Thanks Brexiters! Food inflation just latest Brexit hit

The toll Brexit is taking on consumers and business keeps on mounting. Here are six recent examples.

Food prices go up and up

Food price inflation has hit a four-year high of 4.1%. Consumer price inflation overall remains at 3%, way up from 0.5% since last year’s referendum, ONS figures revealed today. Brexit will make people poorer because the pound slumped after the vote to quit the EU, pushing up prices. Meanwhile, wages are rising slower than inflation.

Pound continues to tumble

The threat of Tory revolt against Theresa May saw the pound fall below $1.31 on Monday. That’s bad news for importers, consumers and Brits travelling abroad. The currency’s vulnerability to political turmoil is clear, and all the instability leads back to one thing: Brexit.

Drop in the shops

With people’s incomes squeezed, it’s not surprising they aren’t spending. Retailers saw a 2.2% drop in consumer spending last month, the fastest year-on-year decline in four years, according to credit card company Visa. Clothing and footwear sales slumped by 9%, the fastest decline since the survey began in 2009.

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Slow-motion car crash

Consumers aren’t shelling out on big-ticket items either. The car industry suffered its seventh consecutive month of falling sales in October. New car registrations fell by 12% year on year, according to the Society of Motor Manufacturers and Traders. But this will be nothing compared to the upheaval if we hit the skids of hard Brexit, which could break supply chains and force foreign car companies to move across the Channel.

Les Russell Group universités

Queen Mary University of London has become the latest top-tier UK university to shift courses abroad. The Russell Group institution’s business school will start teaching its master’s degree in Paris from next September. King’s College London has also announced plans for an EU-based campus after Brexit, setting up a new hub in Germany’s Dresden. The UK will miss out on the economic and cultural benefits of these talented foreign students.

Bank transfers

Banks are scrambling to get their Brexit preparations in place. About 50 have discussed relocation plans with EU authorities, the European Central Bank revealed last week and  around 20 have already applied for European licences in preparation for a hard Brexit.  Among their number is Revolut, one of the UK’s fastest-growing fintech firms which aims to become a global app-based bank. It’s a depressing example of a dynamic, young company doubtful about reaching its full potential in Brexit Britain.

See last week’s round-up of the toll Brexit is taking here.

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Edited by Hugo Dixon