Saturday 23 September 2017

Brexit reality to hit UK - billionaire George Soros

George Soros. Photo: Bloomberg
George Soros. Photo: Bloomberg

Guy Faulconbridge

George Soros, the billionaire who earned fame by betting against the pound in 1992, said Britain was approaching a tipping point that would see the economy slow to such an extent that Brexit might even be reversed.

Mr Soros used Quantum Fund in 1992 to bet successfully that sterling was over-valued against the Deutsche mark, forcing then-prime minister John Major to pull the pound out of the European Exchange Rate Mechanism. Mr Soros said economic reality of Brexit was starting to catch up with the UK.

"The moment of truth is fast approaching," Mr Soros said in an article emailed to reporters.

"Brexit is a lose-lose proposition, harmful both to Britain and the European Union. It cannot be undone, but people can change their minds."

Britain's $2.5 trillion economy has shown resilience since last year's referendum. But Britain went from being one of the fastest-growing economies of the Group of Seven leading economic nations in 2016 to the slowest in early 2017, as the fall in the value of the pound after the Brexit referendum pushed up inflation and hit consumer spending.

The combination of rising prices and slowing wage growth represents a challenge for the Bank of England and its policymakers, three of whom voted last week to raise interest rates to head off the acceleration of inflation.

"Households will realise that their living standards are falling and they will have to adjust their spending habits," Mr Soros said.

Irish Independent

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